Bonner County, Idaho Sandpoint, Idaho · Bonner County, Idaho Sandpoint, Idaho Management’s...

Bonner County, Idaho Sandpoint, Idaho Basic Financial Statements and Independent Auditors’ Report September 30, 2008

Bonner County, Idaho Sandpoint, Idaho Contents Page FINANCIAL SECTION: INDEPENDENT AUDITORS’ REPORT 2‐3

MANAGEMENT’S DISCUSSION AND ANALYSIS 4‐11

BASIC FINANCIAL STATEMENTS:

Government‐wide financial statements: Statement of net assets 12 Statement of activities 13

FUND FINANCIAL STATEMENTS:

Governmental funds: Combined balance sheet 14 Reconciliation of the governmental funds balance sheet to the statement of net assets 15

Combined statement of revenues, expenditures, and changes in fund balances 16

Reconciliation of the combined statement of revenues, expenditures, and changes in fund balances to the statement of activities 17

Budgetary comparison schedules: Statements of revenues, expenditures, and changes in fund balances: General fund 18 Justice fund 19 Road and bridge fund 20 Ambulance district fund 21

Proprietary funds: Statement of net assets 22 Statement of revenues, expenses, and changes in fund net assets 23 Statement of cash flows 24

Fiduciary funds: Statement of fiduciary net assets 25 Statement of changes in fiduciary net assets 26

Notes to basic financial statements 27‐54

Bonner County, Idaho Sandpoint, Idaho Contents (continued) Page SUPPLEMENTAL INFORMATION:

Nonmajor governmental funds: Combining balance sheet – nonmajor governmental funds 56 Combining balance sheet – nonmajor special revenue funds 57‐61 Combining statement of revenues, expenditures, and changes in fund balances – nonmajor governmental funds 62

Combining statement of revenues, expenditures, and changes in fund balances – nonmajor special revenue funds 63‐67

Budgetary comparisons: Governmental funds: Statement of revenues – budget and actual – general fund 68 Statement of expenditures – budget and actual – general fund 69‐71 Statement of revenues – budget and actual – justice fund 72‐73 Statement of expenditures – budget and actual – justice fund 74‐75 Statement of revenues and expenditures – budget and actual – road and bridge fund 76 Statement of revenues and expenditures – budget and actual – ambulance district 77

Proprietary funds: Statement of revenues and expenditures – (Non‐GAAP budgetary basis) – budget and actual – solid waste enterprise fund 78

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INDEPENDENT AUDITORS’ REPORT Board of County Commissioners Bonner County, Idaho Sandpoint, Idaho We have audited the accompanying basic financial statements of the governmental activities, the business‐type activities, each major fund, and the aggregate remaining fund information of Bonner County, Idaho (the County) as of and for the year ended September 30, 2008, which collectively comprise the County’s basic financial statements as listed in the contents. These financial statements are the responsibility of the County’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe our audit provides a reasonable basis for our opinion. In our opinion, the basic financial statements referred to above present fairly in all material respects, the respective financial position of the governmental activities, the business‐type activities, each major fund, and the aggregate remaining fund information of Bonner County, Idaho, as of September 30, 2008, and the respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund, Justice Fund, Road and Bridge Fund, and Ambulance District Fund for the year then ended in conformity with accounting principles generally accepted in the United States of America.

Bellevue

Boise

Grandview

Moses Lake

Omak

Othello

Quincy

Spokane

Tri-Cities

Walla Walla

Wenatchee

Yakima

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In accordance with Government Auditing Standards, we have also issued our report dated May 19, 2009, on our consideration of the County’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Management’s Discussion and Analysis on pages 4 through 11 is not a required part of the basic financial statements but is supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the County’s basic financial statements. The supplemental information section listed in the contents is presented for purposes of additional analysis, and is not a required part of the basic financial statements. The supplemental information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.

Boise, Idaho May 19, 2009

Bonner County, Idaho Sandpoint, Idaho Management’s Discussion and Analysis

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As management of Bonner County, we offer readers of our financial statements this narrative overview and analysis of the financial activities of Bonner County for the fiscal year ended September 30, 2008. We encourage readers to consider the information presented here in conjunction with additional information that has been furnished in the accompanying Notes which are a part of this audit report. Comparative analysis will be done on key elements of governmental funds and enterprise funds in this MD&A. Overview of the Financial Statements This discussion and analysis are intended to serve as an introduction to Bonner County’s basic financial statements. Our basic financial statements are comprised of three components: 1] government‐wide financial statements, 2] fund financial statements, and 3] notes to financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government‐Wide financial statements. These statements are designed to provide readers with a broad overview of Bonner County’s finances in a manner similar to a private‐sector business. The statement of net assets presents information on all County governmental and business‐type assets and liabilities, with the difference reported as net assets. The statement of activities presents information on all County governmental and business‐type revenue and expenses, with the difference reported as a change in net assets. Both of the above noted government‐wide financial statements distinguish functions of Bonner County that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business‐type activities). The governmental activities of Bonner County include all of its general operating costs for all functions except its Solid Waste department. The business‐type activities of Bonner County include its Solid Waste operations. The government‐wide financial statements contain information relative only to Bonner County itself and none of the 40 plus/minus other taxing districts housed within its boundaries. They are public entities unto themselves. Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. Bonner County, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance‐related legal requirements. All of the funds of Bonner County can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds.


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Overview of the Financial Statements (continued) Governmental Funds – This category houses the operations for all departments except for Solid Waste. The Solid Waste operations are our only Proprietary Fund. The Fiduciary Funds are those dollars that we hold in trust for other agencies and taxing districts. An excellent explanation of these funds can be found in Note 1 of this report. Notes to Financial Statements. For an overview of Bonner County and its operations one should refer to the Notes which are an integral part of this report. There, discussion is had concerning the structure of the various offices; how and why our funds are established; when we call for budgets; how changes to a budget can be made once adopted; information concerning our long‐term debt, fixed assets, and leases. Other Information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning Bonner County’s progress in funding its obligations. Government‐wide Financial Analysis This is the second audit report in which Bonner County has been able to provide a comparative analysis of the government‐wide data presented in compliance with the requirements of GASB 34. The comparisons will be found in tables throughout this section. As you examine the tables you will find all of our activities, except Solid Waste, listed under Governmental Activities. Solid Waste information is located under the headings noted as Business‐type Activities.


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Government‐wide Financial Analysis (continued) Table 1 – summarizes the County’s net assets for 2008 compared to 2007: Bonner County’s Net Assets Percentage Governmental Business‐type Change Activities Activities Total 2007‐2008 2008 2007 2008 2007 2008 2007

Current and other assets $ 23,404,616 $ 24,095,448 $ 6,367,030 $ 5,616,365 $ 29,771,646 $ 29,711,813 0.2%

Capital assets 183,500,266 204,516,866 1,585,585 1,590,642 185,085,851 206,107,508 ‐10.2%

Total assets $ 206,904,882 $ 228,612,314 $ 7,952,615 $ 7,207,007 $ 214,857,497 $ 235,819,321 ‐8.9%

Long‐term liabilities outstanding $ 4,733,375 $ 4,921,440 $ 29,509 $ 27,097 $ 4,762,884 $ 4,948,537 ‐3.8%

Other liabilities 3,779,968 5,879,616 403,822 600,133 4,183,790 6,479,749 ‐35.4%

Total liabilities $ 8,513,343 $ 10,801,056 $ 433,331 $ 627,230 $ 8,946,674 $ 11,428,286 ‐21.7%

Net assets:

Invested in capital assets, net of

related debt $ 179,421,774 $ 200,289,824 $ 1,585,585 $ 1,590,642 $ 181,007,359 $ 201,880,466 ‐10.3%

Restricted 310,242 366,788 664,977 664,977 975,219 1,031,765 ‐5.5%

Unrestricted 18,659,523 17,154,646 5,268,722 4,324,158 23,928,245 21,478,804 11.4%

Total net assets $ 198,391,539 $ 217,811,258 $ 7,519,284 $ 6,579,777 $ 205,910,823 $ 224,391,035 ‐8.2%

As noted earlier, the County’s net assets, when reviewed over time, may serve as a useful indicator of the County’s financial position. In the case of the County, assets exceeded liabilities by $205,910,823 ($198,391,539 in governmental activities and $7,519,284 in business activities) as of September 30, 2008. By far, the largest portion of the County’s net assets (89 percent) reflects its investment in capital assets (e.g., land and improvements, buildings and building improvements, improvements other than buildings, machinery and equipment, vehicles, and infrastructure) less any related debt used to acquire those assets that is still outstanding. The County uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the County’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the County’s net assets (0.5 percent) represents resources that are subject to restrictions on how they can be used. The remaining balance of unrestricted assets ($23,928,245) may be used to meet the County’s ongoing obligations to citizens and creditors. Net assets may serve, over time, as a useful indicator of a government’s financial position. At the end of the current fiscal year, Bonner County is able to report positive balances in all three categories of net assets, both for the government as a whole, as well as for its separate governmental and business‐type activities.


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Government‐wide Financial Analysis (continued) Table 2 – shows the changes in net assets for 2008 and 2007: Bonner County’s Changes in Net Assets Governmental Business‐type Percentage Activities Activities Total Change 2008 2007 2008 2007 2008 2007 2007‐2008 Revenues: Program revenues: Charges for services $ 3,044,076 $ 3,253,916 $ 2,561,267 $ 3,549,524 $ 5,605,343 $ 6,803,440 ‐17.6% Operating grants and contributions 1,973,000 2,417,257 ‐ ‐ 1,973,000 2,417,257 ‐18.4% Capital grants and contributions 1,039,478 1,285,389 ‐ ‐ 1,039,478 1,285,389 ‐19.1% General revenues: Property taxes 20,799,323 20,311,189 ‐ ‐ 20,799,323 20,311,189 2.4% Other taxes 209,175 215,531 2,458,381 2,380,910 2,667,556 2,596,441 2.7% Intergovernmental 4,888,631 5,834,657 ‐ ‐ 4,888,631 5,834,657 ‐16.2% Other 1,860,453 1,997,334 (14,214) 57,386 1,846,239 2,054,720 ‐10.1%

Gain on sale ‐ 22,788 ‐ ‐ ‐ 22,788 ‐100.0% Total revenues 33,814,136 35,338,061 5,005,434 5,987,820 38,819,570 41,325,881 ‐6.1% Expenses: General government 7,676,227 7,564,445 ‐ ‐ 7,676,227 7,564,445 1.5% Public safety 14,361,988 13,470,703 ‐ ‐ 14,361,988 13,470,703 6.6% Highways and streets 28,451,678 28,560,179 ‐ ‐ 28,451,678 28,560,179 ‐0.4% Sanitation 153,056 129,528 ‐ ‐ 153,056 129,528 18.2% Health 338,881 308,890 ‐ ‐ 338,881 308,890 9.7% Welfare 477,641 286,225 ‐ ‐ 477,641 286,225 66.9% Education 244,038 285,752 ‐ ‐ 244,038 285,752 ‐14.6% Culture and recreation 1,299,467 2,911,158 ‐ ‐ 1,299,467 2,911,158 ‐55.4% Interest on long‐term debt 230,879 163,720 ‐ ‐ 230,879 163,720 41.0% Solid waste ‐ ‐ 4,065,927 3,988,921 4,065,927 3,988,921 1.9% Total expenses 53,233,855 53,680,600 4,065,927 3,988,921 57,299,782 57,669,521 ‐0.6% Change in net assets $ (19,419,719) $ (18,342,539) $ 939,507 $ 1,998,899 $ (18,480,212) $ (16,343,640) 13.1%

Governmental Activities Charges for services were the County’s largest program revenue, accounting for $3,044,076 of total governmental revenues. These charges are for fees for real estate transfers, fees associated with the collection of property taxes, fines and forfeitures related to judicial activity, and licenses and permits. The County’s grant revenues from Federal and State sources made up $3,012,478 of total governmental revenues. The major recipients of intergovernmental program revenues were the Road and Bridge, Justice, Airport, and Grants. Property tax revenues account for $20,799,323 of the $33,814,136 total revenues for governmental activities. Highways and Streets accounted for $28,451,678 of the $53,233,855 total expenses for governmental activities. The next largest program was Public Safety, accounting for $14,361,988 of the total governmental expenses.


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Governmental Activities (continued): Table 3, for governmental activities, indicates the total cost of services and the net cost of services. The statement of activities reflects the cost of program services and the charges for services, and sales, grants, and contributions offsetting those services. The net cost of services identifies the cost of those services supported by tax revenues and unrestricted intergovernmental revenues. Net Cost of Bonner County’s Governmental Activities as of September 30, 2008 and 2007 Percentage Percentage Total Cost change Net Cost change of Services 2007‐2008 of Services 2007‐2008 2008 2007 2008 2007 General government $ 7,676,227 $ 7,564,445 1.5% $ 5,515,525 $ 5,260,639 4.8% Public safety 14,361,988 13,470,703 6.6% 12,873,926 11,524,416 11.7% Highways and streets 28,451,678 28,560,179 ‐0.4% 27,666,780 27,762,666 ‐0.3% Sanitation 153,056 129,528 18.2% 153,056 129,528 18.2% Health 338,881 308,890 9.7% 338,631 308,434 9.8% Welfare 477,641 286,225 66.9% 477,641 286,225 66.9% Education 244,038 285,752 ‐14.6% 235,254 281,972 ‐16.6% Culture and recreation 1,299,467 2,911,158 ‐55.4% (314,391) 1,006,438 ‐131.2% Interest on long‐term debt 230,879 163,720 41.0% 230,879 163,720 41.0% Total $ 53,233,855 $ 53,680,600 ‐0.8% $ 47,177,301 $ 46,724,038 1.0%

Charges for services of $2,160,702 are received and used to fund the general government expenses of the County. The remaining $47,177,301 in net governmental activity costs are funded by property taxes, sales taxes, and intergovernmental revenues. Business‐Type Activities The net assets for business‐type activities increased by $939,507 during 2008 and the major revenue sources were charges for services of $2,561,267. Overall Financial Position Governmental Funds: The major funds include our General (Current Expense), Road and Bridge, Justice Fund, and the Ambulance District. The General, Justice, and Road and Bridge increased their overall fund balance from prior years. The remaining major fund, the Ambulance District, saw a decrease in utilization of the reserves maintained to finance operations.


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Overall Financial Position (continued): Enterprise Fund: During fiscal year 2004 – 2005 we reported a concern wherein our usual operating expenses continued to exceed the revenue generated. This forced us to continually supplant our every‐day operations by using funds that had been set aside to pay for major building projects in our solid waste operations as our community grows and our needs increase. The Board of County Commissioners resolved this problem by implementing a new fee schedule in FY 2004 – 2005. Our revenues from this source began to be realized in FY 2005 – 2006, and was fully implemented in FY 2006 – 2007. During the current fiscal year 2008 the charges exceeded the expenses by $939,507. Notes to Financial Statements: The notes provide additional information that is essential to a full understanding of the data presented in the governmental‐wide and financial statements. These notes to the financial statements can be found at the end of the audit report. Capital Assets Capital Assets are all tangible and intangible assets—such as land, buildings, improvements to land or buildings, machinery, equipment, and infrastructure—that are used in operations and that have initial useful lives extending beyond a single reporting period. The total net capital assets decreased by $21,016,600. This amount represents book value of assets less accumulated depreciation. The decrease in capital assets was mainly due to the accumulated depreciation of $24,201,289. Capital assets additions amounted to $3,247,171 and capital asset deletions amounted to $62,482 for the fiscal year. Long‐Term Debt Long‐term liabilities are the debt incurred by the County. The debt typically has a maturity date that extends beyond a single reporting cycle. Additional information on long‐term debt can be found in notes 7 and 8 in the basic financial statements. Long‐term liabilities had a net decrease of $188,065. Please see the tables titled Bonner County’s Net Assets and Bonner County’s Changes in Net Assets for further detail regarding these comments. These tables are an integral part of the Management’s Discussion and Analysis Report. Budget Variations Developing a budget is not an exact science. It is the best estimate available at the time of projection of the revenues you anticipate receiving and of the expenses you think you might incur during the next fiscal year. For the fiscal year ended September 30, 2008, there were no funds for which expenditures exceeded appropriations.


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Economic and Other Factors Affecting Next Year’s Operations Local Economy: While other areas in the State are experiencing a negative growth resulting in reduced market valuations, Bonner County is still growing. Our median family income for 1998 was $33,700 while in the State as a whole it was $41,300. Both of these compare to the United States that had a median family income of $45,300 for the same time period. The higher competition for jobs in the County tends to keep wages low. The past 40 years has also seen a shift in focus of those jobs from timber based to service based. However, the rapid population increases of the past few decades have led to a doubling of construction jobs since 1990 and a tripling of them since 1988. Retail trade has grown rapidly, spurred by population growth, rising incomes, expansion of tourism, and the past expansion of Coldwater Creek. The growth of Litehouse and the opening of other firms also contributed to manufacturing growth. [Source: Regional Economic Profile, Idaho Dept. of Labor] Bonner County is a rural county rather than an urban one. The following table shows the areas of growth in Bonner County for the past 40 years. [Source: Idaho Vital Statistics Annual Report]

Entity 1970 1980 1990 2000

Bonner County 15,560 24,163 26,622 36,835

Clark Fork 367 449 448 530

Dover 294 342

East Hope 175 258 215 200

Hope 63 106 99 79

Kootenai 168 280 327 441

Oldtown 161 257 151 190

Ponderay 275 398 449 638

Priest River 1,493 1,639 1,560 1,754

Sandpoint 4,144 4,460 5,203 6,835

In addition to the nine incorporated cities noted in the above table, Bonner County is home to 40 plus/minus taxing districts each of which elects its own governing board and has the authority to levy taxes. Many of these taxing districts have experienced significant growth and an increase in the demand for services that such growth generates.


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Economic and Other Factors Affecting Next Year’s Operations (continued) County Operations (continued):

• Panhandle Area Council (PAC) has purchased the former Federal Building in Sandpoint. Bonner County has agreed to lease this building from them for 30 years with the intent of purchasing the building at the end of the lease period for $1.00. This is the culmination of the work performed and the decisions made by not only the current board but many previous Boards who sought a solution to our overcrowded situation. The planning department and the Assessor’s operations have moved into the 2nd floor of the building. Upon completion of that project, work was undertaken on the annex building and the Prosecuting Attorney’s office moved into it in February 2008. This freed up the rent money we had been paying to the City of Sandpoint. During the 2007‐2008 fiscal year, remodeling was undertaken on the 3rd floor. That was completed and some offices moved into the new suites in October of 2008. More offices will move to the 3rd floor during the next fiscal year of 2008‐2009

• Bonner County continually fights the battle of low salaries/wages when trying to attract employees in almost every category of its operations. January 2007 saw a new Board of Commissioners take office who recognized this deficiency and during the budget setting process made the decision to again devote a great deal of the budget increase to enhancing those wages and the benefit package. In 2008, the same Board recognized the economic downturn beginning to affect our employees and wage increases were kept to a minimum of a 2% COLA.

• During the past few years Bonner County experienced a phenomenal growth rate. This had a major impact on our infrastructure, new housing starts, on law enforcement, the courts, planning and zoning, airport, indigent needs etc. While the growth rate has slowed down over the past year or so, the impact of the new arrivals is still being felt.

• During this fiscal year, Bonner County was also beginning to feel the pinches of the economic downturn affecting the whole Country. Home sales came to a standstill and foreclosures increased dramatically. The closing of the JD Lumber Company in Priest River had a significant, negative economic impact. Riley Creek Lumber Company has also reduced its operations due to the economic climate. Both events led to a loss of over 400 jobs in our community. During the last quarter of 2008, the jobless rate in Bonner County hit over 7% which was even higher than the State average.

Requests for Information This financial report is designed to provide a general overview of Bonner County’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to:

Marie Scott, Bonner County Clerk Bonner County Courthouse 215 South First Avenue Sandpoint, Idaho 83864

Bonner County, Idaho

Sandpoint, Idaho

Statement of Net Assets September 30, 2008

Primary Government

Governmental Business-type

Activities Activities Total

ASSETSCash and investments 21,463,542 $ 5,343,706 $ 26,807,248 $

Receivables, net of allowance for uncollectibles:

Taxes 1,466,277 - 1,466,277

Fees - 2,740 2,740

Interest 85,808 - 85,808

Accounts 251,027 355,607 606,634

Special assessments - - -

Other current assets 19,005 - 19,005

Due from other governments 118,957 - 118,957

Restricted assets:

Cash - 664,313 664,313

Cash on deposit with fiscal agent - 664 664

Capital assets:

Land 3,728,881 177,590 3,906,471

Other capital assets, net of depreciation 179,771,385 1,407,995 181,179,380

Total assets 206,904,882 7,952,615 214,857,497

LIABILITIESWarrants payable 2,094,591 380,942 2,475,533

Vouchers payable 169,488 - 169,488

Accrued payroll 403,487 18,269 421,756

Accrued retirement payable 70,873 4,611 75,484

Accrued interest payable 28,672 - 28,672

Due to other governments 18,000 - 18,000

Deferred revenue 994,857 - 994,857

Long-term liabilities:

Due within one year:

Compensated absences 516,909 29,509 546,418

Special assessment bonds payable 220,000 - 220,000

Leases payable 214,764 - 214,764

Due in more than one year:

Compensated absences 137,974 - 137,974

Special assessment bonds payable 135,000 - 135,000

Leases payable 3,508,728 - 3,508,728

Total liabilities 8,513,343 433,331 8,946,674

NET ASSETSInvested in capital assets, net of related debt 179,421,774 1,585,585 181,007,359

Restricted for:

Debt retirement 310,242 664 310,906

Capital improvements - 664,313 664,313

Unrestricted 18,659,523 5,268,722 23,928,245

Total net assets 198,391,539 $ 7,519,284 $ 205,910,823 $

See accompanying notes to basic financial statements.

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Sandpoint, Idaho

Statement of Activities Year Ended September 30, 2008

Program Revenues

Operating Capital

Charges for Grants and Grants and Governmental Business-type

Functions/Programs Expenses Services Contributions Contributions Activities Activities Total

Primary government:

Governmental activities:

General government 7,676,227 $ 2,160,702 $ - $ - $ (5,515,525)$ - $ (5,515,525)$

Public safety 14,361,988 883,124 534,884 70,054 (12,873,926) - (12,873,926)

Highways and streets 28,451,678 - - 784,898 (27,666,780) - (27,666,780)

Sanitation 153,056 - - - (153,056) - (153,056)

Health 338,881 250 - - (338,631) - (338,631)

Welfare 477,641 - - - (477,641) - (477,641)

Education 244,038 - 8,784 - (235,254) - (235,254)

Culture and recreation 1,299,467 - 1,429,332 184,526 314,391 - 314,391

Interest on long-term debt 230,879 - - - (230,879) - (230,879)

Total governmental activities 53,233,855 3,044,076 1,973,000 1,039,478 (47,177,301) - (47,177,301)

Business-type activities:

Solid waste 4,065,927 2,561,267 - - - (1,504,660) (1,504,660)

Total business-type activities 4,065,927 2,561,267 - - - (1,504,660) (1,504,660)

Total primary government 57,299,782$ 5,605,343$ 1,973,000$ 1,039,478$ (47,177,301) (1,504,660) (48,681,961)

General revenues:

Taxes:

Property taxes, levied for general purposes 20,799,323 - 20,799,323

Special assessments 209,175 2,458,381 2,667,556

Intergovernmental revenues 4,888,631 - 4,888,631

Miscellaneous 810,046 22,786 832,832

Interest and investment earnings 1,013,407 - 1,013,407

Transfers 37,000 (37,000) -

Total general revenues and special items 27,757,582 2,444,167 30,201,749

Change in net assets (19,419,719) 939,507 (18,480,212)

Net assets, beginning 217,811,258 6,579,777 224,391,035

Net assets, ending 198,391,539 $ 7,519,284 $ 205,910,823 $


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Net (Expense) Revenue and

Changes in Net Assets

Primary Government


Sandpoint, Idaho

Combined Balance Sheet - Governmental Funds September 30, 2008

Road and Ambulance Other Total

General Justice Bridge District Governmental Governmental

Assets

Cash and investments 3,626,718$ 4,985,471$ 3,999,577$ 853,856$ 7,997,920$ 21,463,542$

Receivables, net of allowance

for uncollectibles:

Taxes 117,324 515,605 241,787 - 229,160 1,103,876

Accounts 85,606 25,595 4,291 2,250 133,285 251,027

Interest 85,658 - - - 150 85,808

Special assessments - - - - - -

Due from other funds - 1,091,205 - - - 1,091,205

Due from other governments - 64,756 - - 54,201 118,957

Other assets - - - - 19,005 19,005

Total assets 3,915,306$ 6,682,632$ 4,245,655$ 856,106$ 8,433,721$ 24,133,420$

Liabilities and Fund Balances

LIABILITIES:

Warrants payable 170,837 $ 419,129 $ 287,895 $ 83,851 $ 1,132,879 $ 2,094,591 $

Vouchers payable 1,864 2,469 81 9,703 155,371 169,488

Accrued payroll 57,034 177,050 47,507 32,770 89,126 403,487

Accrued retirement payable 10,954 41,839 12,970 5,110 - 70,873

Due to other funds - - - 1,091,205 18,000 1,109,205

Deferred revenue 102,107 449,418 212,459 - 230,873 994,857

Compensated absences payable 56,458 256,440 86,876 20,177 96,958 516,909

Total liabilities 399,254 1,346,345 647,788 1,242,816 1,723,207 5,359,410

FUND BALANCES:

Unreserved, reported in:

General fund 3,516,052 - - - - 3,516,052

Special revenue fund - 5,336,287 3,597,867 (386,710) 5,528,927 14,076,371

Capital project fund - - - - 871,345 871,345

Debt service fund - - - - 310,242 310,242

Total fund balances (deficit) 3,516,052 5,336,287 3,597,867 (386,710) 6,710,514 18,774,010

Total liabilities and

fund balances 3,915,306 $ 6,682,632 $ 4,245,655 $ 856,106 $ 8,433,721 $ 24,133,420 $


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Sandpoint, Idaho

Reconciliation of the Governmental Funds Balance Sheet

to the Statement of Net Assets September 30, 2008

Total fund balances as shown on the Governmental Funds Balance Sheet 18,774,010 $

Capital assets used in governmental activities are not financial resources

and, therefore, are not reported in the funds. This amount reflects the

initial investment in capital assets, net of depreciation,

at September 30, 2007. 183,500,266

Other long-term assets are not available to pay for current period

expenditures and, therefore, are deferred in the funds:

Property taxes 362,401

Long-term liabilities, including capital leases payable and accrued

interest payable are not due and payable in the current period

and, therefore, are not reported in the funds:

Capital leases payable (3,723,492)$

Special assessment bonds payable (355,000)

Compensated absences (137,974)

Accrued interest payable (28,672)

(4,245,138)

Total net assets as shown on the statement of net assets 198,391,539 $


15


Sandpoint, Idaho

Combined Statement of Revenues, Expenditures, and

Changes in Fund Balances - Governmental Funds Year Ended September 30, 2008

Other Total

Road and Ambulance Governmental Governmental

General Justice Bridge District Funds Funds

REVENUES:

Taxes 1,977,812 $ 8,589,395 $ 3,903,497 $ 2,299,127 $ 4,426,330 $ 21,196,161 $

Licenses and permits 595,634 248,714 - - 228,990 1,073,338

Intergovernmental 742,974 1,378,288 2,554,118 - 3,225,729 7,901,109

Charges for services 427,169 634,410 - - 642,557 1,704,136

Fines - - - - 266,602 266,602

Special assessments - - - - 209,175 209,175

Interest income 1,010,123 - - - 3,284 1,013,407

Rental income - - - - 139,013 139,013

Miscellaneous 56,730 183,035 149,565 250 281,438 671,018

Total revenues 4,810,442 11,033,842 6,607,180 2,299,377 9,423,118 34,173,959

EXPENDITURES:

Current:

General government 3,830,065 - - - 3,591,699 7,421,764

Public safety 174,906 10,176,547 - 2,015,587 1,597,320 13,964,360

Highways and streets - - 4,147,200 - 484,298 4,631,498

Sanitation - - - - 153,309 153,309

Health - - - - 264,469 264,469

Welfare - - - - 477,641 477,641

Education - - - - 246,049 246,049

Culture and recreation - - - - 1,277,366 1,277,366

Capital outlay 47,253 345,104 1,331,132 261,669 1,262,013 3,247,171

Debt service:

Principal 49,808 - 169,206 20,867 220,000 459,881

Interest and fiscal charges 120,997 - 52,564 3,186 47,326 224,073

Total expenditures 4,223,029 10,521,651 5,700,102 2,301,309 9,621,490 32,367,581

EXCESS OF REVENUES OVER

(UNDER) EXPENDITURES 587,413 512,191 907,078 (1,932) (198,372) 1,806,378

OTHER FINANCING

SOURCES (USES):

Operating transfers in (out) (270,970) (354,295) (12,500) (70,000) 744,765 37,000

Capital leases proceeds - - - - - -

Total other financing

sources (uses) (270,970) (354,295) (12,500) (70,000) 744,765 37,000

NET CHANGE IN FUND BALANCES 316,443 157,896 894,578 (71,932) 546,393 1,843,378

FUND BALANCES (DEFICIT),

BEGINNING OF YEAR 3,199,609 5,178,391 2,703,289 (314,778) 6,164,121 16,930,632

FUND BALANCES (DEFICIT),

END OF YEAR 3,516,052 $ 5,336,287 $ 3,597,867 $ (386,710)$ 6,710,514 $ 18,774,010 $


16


Sandpoint, Idaho

Reconciliation of the Combined Statement of Revenues,

Expenditures, and Changes in Fund Balances to the

Statement of Activities - Governmental Funds Year Ended September 30, 2008

Amounts reported for governmental activities in the statement of

activities are different because:

Net change in fund balances, total governmental funds 1,843,378 $

Governmental funds report capital outlays as expenditures.

However, in the statement of activities the cost of those assets

is allocated over their estimated useful lives and reported as

depreciation expense:

Capital outlay 3,247,171 $

Depreciation expense (24,201,289)(20,954,118)

Revenues in the statement of activities that do not provide current

financial resources are not reported as revenues in the funds. (396,838)

The net effect of various miscellaneous transactions involving capital

assets (i.e., sales, trade-in, and donations) is to increase net assets. (373,798)

The issuance of long-term debt provides current financial

resources to governmental funds, while the repayment of the

principal of long-term debt consumes the current financial

resources of governmental funds. Neither transaction has any

effect on net assets. Also, governmental funds report the effect of

issuance costs, premiums, discounts, and similar items when

debt is first issued, whereas these amounts are deferred and

amortized in the statement of activities. This amount is the net

effect of these differences in the treatment of long-term debt and

related items:

Principal payments 459,881

Accrued interest for long-term debt. This is the net change in accrued

interest for the current period. (6,806)

Some expenses reported in the statement of activities do not require the

use of current financial resources and, therefore, are not reported

as expenditures in governmental funds. 8,582

Change in net assets, as reflected on the statement of activities (19,419,719)$


17


Sandpoint, Idaho

Statement of Revenues, Expenditures,

and Changes in Fund Balances -

Budget and Actual - General Fund Year Ended September 30, 2008

Variance

Budgeted Amounts Favorable

Original Final Actual (Unfavorable)

REVENUES:

Taxes 2,382,015 $ 2,382,015 $ 1,977,812 $ (404,203)$

Licenses and permits 763,845 763,845 595,634 (168,211)

Intergovernmental 748,697 748,697 742,974 (5,723)

Charges for services 428,056 428,056 427,169 (887)

Interest income 1,163,500 1,163,500 1,010,123 (153,377)

Miscellaneous 6,280 6,280 56,730 50,450

Total revenues 5,492,393 5,492,393 4,810,442 (681,951)

EXPENDITURES:

Current:

General government 4,714,250 4,715,750 3,830,065 885,685

Public safety 191,691 192,001 174,906 17,095

Capital outlay 38,823 38,823 47,253 (8,430)

Debt service:

Principal 106,513 106,513 49,808 56,705

Interest and fiscal charges 120,997 120,997 120,997 -

Total expenditures 5,172,274 5,174,084 4,223,029 951,055


EXPENDITURES 320,119 318,309 587,413 269,104

OTHER FINANCING SOURCES:

Operating transfers in (out) - - (270,970) (270,970)

NET CHANGE IN FUND BALANCE 320,119 318,309 316,443 (1,866)

FUND BALANCES, BEGINNING OF YEAR 3,199,609 3,199,609 3,199,609 -

FUND BALANCES, END OF YEAR 3,519,728 $ 3,517,918 $ 3,516,052 $ (1,866)$


18


Sandpoint, Idaho



Budget and Actual - Justice Fund Year Ended September 30, 2008

Variance



REVENUES:

Taxes 8,947,785 $ 8,947,785 $ 8,589,395 $ (358,390)$

Licenses and permits 226,000 226,000 248,714 22,714

Intergovernmental 1,532,950 1,532,950 1,378,288 (154,662)

Charges for services 514,600 514,600 634,410 119,810

Miscellaneous 113,560 113,560 183,035 69,475

Total revenues 11,334,895 11,334,895 11,033,842 (301,053)

EXPENDITURES:

Current:

Public safety 10,710,357 10,678,680 10,176,547 502,133

Capital outlay 240,570 496,570 345,104 151,466



EXPENDITURES 383,968 159,645 512,191 352,546







19


Sandpoint, Idaho



Budget and Actual - Road and Bridge Fund Year Ended September 30, 2008

Variance



REVENUES:

Taxes 4,103,546 $ 4,103,546 $ 3,903,497 $ (200,049)$

Intergovernmental 2,279,755 2,279,755 2,554,118 274,363

Miscellaneous 74,910 74,910 149,565 74,655

Total revenues 6,458,211 6,458,211 6,607,180 148,969

EXPENDITURES:

Current:

Highways and streets 5,521,595 5,521,595 4,147,200 1,374,395

Capital outlay 516,244 818,058 1,331,132 (513,074)

Debt service:

Principal 235,762 235,762 169,206 66,556




(UNDER) EXPENDITURES 132,046 (169,768) 907,078 1,076,846



NET CHANGE IN FUND BALANCE 132,046 (169,768) 894,578 1,064,346


FUND BALANCES, END OF YEAR 2,835,335 $ 2,533,521 $ 3,597,867 $ 1,064,346 $


20


Sandpoint, Idaho



Budget and Actual - Ambulance District Year Ended September 30, 2008

Variance



REVENUES:

Taxes 2,612,878 $ 2,612,878 $ 2,299,127 $ (313,751)$

Miscellaneous - - 250 250

Total revenues 2,612,878 2,612,878 2,299,377 (313,501)

EXPENDITURES:

Current:

Public safety 2,390,544 2,416,544 2,015,587 400,957

Capital outlay 136,334 136,334 261,669 (125,335)

Debt service:

Principal 56,814 56,814 20,867 35,947




(UNDER) EXPENDITURES 26,000 - (1,932) (1,932)



NET CHANGE IN FUND BALANCE 26,000 - (71,932) (71,932)

FUND BALANCES (DEFICIT), BEGINNING OF YEAR (314,778) (314,778) (314,778) -

FUND BALANCES (DEFICIT), END OF YEAR (288,778)$ (314,778)$ (386,710)$ (71,932)$


21


Sandpoint, Idaho

Statement of Net Assets - Proprietary Funds September 30, 2008

Business-type Activities

Enterprise Funds

Solid Waste

Assets

CURRENT ASSETS:

Cash and cash equivalents 5,343,706 $ Receivables, net of allowance for uncollectibles:

Fees 2,740 Accounts 355,607

Total current assets 5,702,053

NONCURRENT ASSETS:

Restricted assets:

Cash 664,313 $ Cash on deposit with fiscal agent 664

Fixed assets, net of depreciation 1,585,585 Total noncurrent assets 2,250,562

Total assets 7,952,615 $

Liabilities and Net Assets

CURRENT LIABILITIES:

Warrants payable 380,942 $ Accrued payroll 18,269 Accrued retirement payable 4,611 Compensated absences payable 29,509

Total current liabilities 433,331

NONCURRENT LIABILITIES:

Compensated absences payable -

Total liabilities 433,331

NET ASSETS:Invested in capital assets, net of related debt 1,585,585 $ Reserved for:

Debt retirement 664 Capital improvements 664,313

Unrestricted 5,268,722

7,519,284

Total liabilities and net assets 7,952,615 $


22

Bonner County, IdahoSandpoint, Idaho

Statement of Revenues, Expenses,

and Changes in Fund Net Assets -

Proprietary Funds Year Ended September 30, 2008

Business-type Activities

Enterprise Funds

Solid Waste

OPERATING REVENUES:

Charges for services 5,019,648 $

OPERATING EXPENSES:

Salaries 601,098 $

Benefits 300,107

Other services and charges 3,037,402

Depreciation 127,320

Total operating expenses 4,065,927

OPERATING INCOME 953,721

NONOPERATING REVENUES:

Penalties and interest 22,786

Miscellaneous -

Total nonoperating revenues 22,786

TRANSFERS:

Transfers out (37,000)

CHANGE IN NET ASSETS 939,507

NET ASSETS, BEGINNING OF YEAR 6,579,777

NET ASSETS, END OF YEAR 7,519,284 $


23


Sandpoint, Idaho

Statement of Cash Flows - Proprietary Funds

Business-type

Activities

Enterprise Funds

Solid Waste

Increase (Decrease) in Cash and Cash Equivalents

CASH FLOWS FROM OPERATING ACTIVITIES:

Cash received from customers 4,996,247 $

Cash payments to suppliers for goods and services (3,534,539)Cash payments to employees for services (597,967)

Net cash provided by operating activities 863,741

CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:

Miscellaneous receipts 22,786 $

Cash paid to Bonner County (37,000)Net cash used in noncapital financing activities (14,214)

CASH FLOWS FROM CAPITAL FINANCING AND RELATED

FINANCING ACTIVITIES:

Acquisition of fixed assets (122,263)

NET INCREASE IN CASH AND CASH EQUIVALENTS 727,264

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 5,281,419

CASH AND CASH EQUIVALENTS, END OF YEAR 6,008,683 $

CASH AND CASH EQUIVALENTS:

Cash 5,343,706 $

Restricted assets:

Cash 664,313 Cash on deposit with fiscal agent 664

6,008,683 $


24

Year Ended September 30, 2008

Business-type

Activities

Enterprise Funds

Solid Waste

Reconciliation of Operating Income to NetCash Provided by Operating Activities:

Operating income 953,721 $

Adjustments to reconcile operating income to net

cash provided by operating activities:

Depreciation 127,320 $

Changes in assets and liabilities:

Increase in receivables:

Fees (342)Accounts (23,059)

Decrease in warrants payable (202,074)Increase in accrued payroll 5,044 Increase in retirement payable 719 Increase in compensated absences payable 2,412

Total adjustments (89,980)

Net cash provided by operating activities 863,741 $

24


Sandpoint, Idaho

Statement of Fiduciary Net Assets - Fiduciary Funds September 30, 2008

Fiduciary Fund Types

Employee 457

Deferred Totals

Compensation Agency (Memorandum

Trust Fund Funds Only)

Assets

Cash and cash equivalents 519,231 $ 1,132,422 $ 1,651,653 $

Receivable, net of allowance for uncollectibles:

Taxes - 1,239,737 1,239,737

Total assets 519,231 $ 2,372,159 $ 2,891,390 $

Liabilities and Net Assets

LIABILITIES:

Warrants payable - $ 392,288 $ 392,288 $

Accounts payable - 619,887 619,887

Due to other taxing districts - 1,359,984 1,359,984

Total liabilities - 2,372,159 2,372,159

NET ASSETS:

Investments held in trust for participants 519,231 - 519,231

519,231 $ 2,372,159 $ 2,891,390 $


25


Sandpoint, Idaho

Statement of Changes in Fiduciary

Net Assets - Fiduciary Funds Year Ended September 30, 2008

Employee

457

Deferred

Compensation

Trust Fund

ADDITIONS:

Trust receipts 45,619 $

DEDUCTIONS:

Trust turnovers 69,525

CHANGE IN NET ASSETS (23,906)

NET ASSETS, BEGINNING OF YEAR 543,137

NET ASSETS, END OF YEAR 519,231 $


26

Bonner County, Idaho Sandpoint, Idaho Notes to Basic Financial Statements

27

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Organization: The financial statements of Bonner County, Idaho (the County) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard‐setting body for establishing governmental accounting and financial reporting principles. Summary of Significant Accounting Policies: The County’s significant accounting policies are described below: Reporting Entity – The County operates under a commissioner form of government, with supervision of various departments by elected officials as provided by the State Constitution. The County provides the following services: public safety (police), highways and streets, sanitation, health and social services, welfare, culture and recreation, public improvements, planning and zoning, and general administrative services. For financial reporting purposes, management has considered all potential component units which are controlled or whose boards are appointed by the Board of County Commissioners. Control by the County was determined on the basis of budget adoption, the selection of management, the ability to significantly influence operations, accountability for fiscal matters, and other factors. Based on this criteria, there was one component unit included in the County’s report, which is reported within the special revenue funds and is reported as a major fund. Blended Component Units – The Ambulance District of Bonner County is a blended component unit and is responsible for providing emergency medical services and medical transportation to the residents of the County. The Ambulance District’s governing body is the same as that of Bonner County’s governing body, the Board of County Commissioners. The County has the ability to significantly impose its will over the Ambulance District. Management of the Ambulance District consists of those individuals responsible for the day‐to‐day operations of the County; and the Ambulance District provides services wholly within the boundaries of the County with the intention of providing medical services to the residents of the County. Therefore, the Ambulance District is presented as a blended component unit and is grouped as a special revenue fund.


28

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Measurement Focus and Basis of Presentation – The basic financial statements of the County are composed of the following:

• Government‐wide financial statements • Fund financial statements • Notes to basic financial statements

Financial reporting is based upon all GASB pronouncements, as well as the Financial Accounting Standards Board (FASB) Statements and Interpretations, APB Opinions, and Accounting and Research Bulletins that were issued on or before November 30, 1989, that do not conflict with or contradict GASB pronouncements. FASB pronouncements issued after November 30, 1989, are not allowed in preparation of the accompanying financial statements. Government‐wide Financial Statements – Government‐wide financial statements consist of the statement of net assets and the statement of activities. These statements report information on all of the non‐fiduciary activities of the primary government. For the most part, the effect of the interfund activity has been removed from these statements. Governmental activities, which are normally supported by taxes and intergovernmental revenue, are reported separate from business‐type activities, which rely to a significant extent on fees and charges for support. Government‐wide financial statements are presented using the economic resources measurement focus and accrual basis of accounting. Under the economic resources measurement focus, all (both current and long‐term) economic resources and obligations of the reporting government are reported in the government‐wide financial statements. Basis of accounting refers to when revenues and expenses are recognized in the accounts and reported in the financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, and liabilities resulting from exchange and exchange‐like transactions are recognized when the exchange takes place. Revenues, expenses, gains, losses, assets, and liabilities resulting from nonexchange transactions are recognized in accordance with the requirements of GASB Statement No. 33.


29

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Government‐wide Financial Statements (continued) – The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function, and 2) grants and contributions that are restricted to meeting the operational and capital requirements of a particular function. Taxes and other items not included among program revenues are reported as general revenues. Other items not properly included among program revenues are reported instead as general revenues. Major individual governmental funds are reported as separate columns in the fund financial statements. Program revenues include charges for services and payments made by parties outside the reporting County’s citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program. Amounts paid to acquire capital assets are capitalized as assets in the government‐wide financial statements, rather than reported as an expenditure. Proceeds of long‐term debt are recorded as a liability in the government‐wide financial statements, rather than as an other financing source. Amounts paid to reduce long‐term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as an expenditure. Fund Financial Statements – The underlying accounting system of the County is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self‐balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. These statements provide information about the District’s funds. The emphasis of fund financial statements is on major governmental funds. Each major fund is displayed in a separate column. All of the remaining funds are aggregated and reported in a single column as other governmental funds (if applicable).


30

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Fund Financial Statements (continued) – a) Governmental Funds – In the fund financial statement, governmental funds are presented using the modified

accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting period. The County uses an availability period of 60 days. Revenue recognition is subject to the measurable and availability criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed derived tax revenues are recognized as revenues in the period in which the underlying exchange transaction upon which they are based takes place. Imposed nonexchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Government‐mandated and voluntary nonexchange transactions are recognized as revenues when all applicable eligibility requirements have been met. In the fund financial statements, governmental funds are presented using the current financial resources measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. The reported fund balance (net current assets) is considered to be a measure of “available spendable resources.” Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of “available spendable resources” during a period. Noncurrent portions of long‐term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus. Special reporting treatments are used to indicate, however, that they should not be considered “available spendable resources,” since they do not represent the net current assets.


31

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Fund Financial Statements (continued) –

Recognition of governmental fund‐type revenue represented by noncurrent receivables are deferred until they become current receivables. Noncurrent portions of long‐term receivables are offset by fund balance reserve accounts. Due to the nature of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect current assets, such long‐term amounts are not recognized as governmental fund‐type expenditures or fund liabilities. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long‐term debt are recorded as an other financing source rather than as a fund liability. Amounts paid to reduce long‐term indebtedness are reported as fund expenditures. When both restricted and unrestricted resources are combined in a fund, expenses are considered to be paid first from restricted resources, and then from unrestricted resources. The following comprise the County’s major governmental funds: The General Fund is the County’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Justice Fund accounts for the services and equipment used to provide for the public safety of the County. The Road and Bridge Fund accounts for the design, construction, and maintenance of County roads. The Ambulance District accounts for the revenues earned and services provided for medical care.


32

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Fund Financial Statements (continued) –

b) Proprietary Funds – account for ongoing organizations and activities of the government, which are similar to

those found in the private sector. Proprietary funds are accounted for on the flow of economic resources measurement focus and use the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred. In accordance with GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities that Use Proprietary Fund Accounting, the County has elected to apply all applicable FASB pronouncements, including those issued on or before November 30, 1989, except for those pronouncements which conflict with or contradict GASB pronouncements. Proprietary funds include the following fund type:

The Enterprise Fund is used to account for those operations that meet one of two criteria; (1) The activity runs in manner similar to private business enterprises. Moreover, the intent of the governing body is that the ongoing operating costs (including depreciation) of providing goods or services to the public are financed or recovered primarily through user charges; (2) Where the governing body has decided that the periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes.

The proprietary funds financial statements distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods and services in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the County’s enterprise fund are charges to customers for services. Operating expenses for enterprise funds include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses.

c) Fiduciary Funds – account for assets held by the County in a trustee capacity or as an agent on behalf of

others.

The Agency Fund is custodial in nature and does not present results of operations or have a measurement focus. Agency funds are accounted for using the modified accrual basis of accounting. This fund is used to account for assets that the County holds for others in an agency capacity.


33

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Deposits and Investments – The cash balances of substantially all funds are pooled and invested by the County Treasurer for the purpose of increasing earnings through investment activities. The pool’s investments are stated at fair value at September 30, 2008, as determined by quoted market prices, except for the certificates of deposit which are nonparticipating contracts, and are therefore carried at cost. The individual funds’ portions of the pool’s fair value are presented as “investments.” Interest earned on the pooled funds is apportioned and paid or credited to the funds quarterly based on the average daily balance of each participating fund. Interest earnings in certain special revenue funds are transferred to the general fund based on management policy. Idaho Code Section 67 (Code), Chapter 12, provides authorization for the investment of funds as well as to what constitutes an allowable investment. County policy is consistent with the State Code. The Code limits investments to the following general types:

1. Certain revenue bonds, general obligation bonds, local improvement district bonds and registered warrants of state and local governmental entities.

2. Time deposit accounts, tax anticipation, and interest‐bearing notes.

3. Bonds, treasury bills, debentures, or other similar obligations of the United States government and United States government agencies.

4. Repurchase agreements secured by the above.

Cash and investments are pooled and invested in certificates of deposit, United States treasury securities, United States government agency securities, and repurchase agreements secured by United States government securities or United States government agencies. The County’s policy has been to hold investments until maturity in an attempt to reduce market fluctuation risk. For purposes of the statement of cash flows, the County considers all highly liquid investments purchased with a maturity of three months or less to be cash. Cash and investment balances for the enterprise funds represent their allocated share of pooled cash and investments of the County and can be drawn down on demand. The investment purchases and sales information is not available for individual funds and management believes that due to the nature of the pooled investments, this information is not significant for purposes of understanding the statement of cash flows. Accordingly, the net change method is used to report cash flows from investments in these statements.


34

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Receivables and Payables – Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “interfund receivables/payables” (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the noncurrent portion of interfund loans). All other outstanding balances between funds are reported as “due to/from other funds.” Receivables are recorded at gross. The allowance for uncollectible accounts is zero at September 30, 2008. Property taxes are an enforceable lien on property. The County property taxes are levied on or before the third Monday of the preceding September and billed to taxpayers in November. The taxes are due in two installments. One half of the personal property taxes and one‐half of the real property taxes are due on or before December 20. The remaining one‐half of the personal real property taxes is due on or before June 20 of the following year. If the first half of the personal property tax becomes delinquent, then the full tax is due. The County bills and collects its own property taxes and also collects taxes for all other taxing districts within its boundaries. Restricted Assets – Certain proceeds and resources are set aside and classified as restricted assets on the statement of net assets because their use is limited by County resolution. In the Solid Waste Enterprise fund, resources have been set aside for future certificate retirement and capital improvements. The County does not maintain a solid waste landfill. All waste hauling is contracted out and the County has no liability for disposal or landfill costs. Capital Assets – Capital assets including land, building, improvements, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business‐type activities columns in the government‐wide financial statements. Capital assets are defined by the County as assets with an initial, individual cost of more than $5,000 and an initial useful life of one year or greater. Such assets are recorded at historical cost if purchased or constructed. Donated capital assets are recorded at their estimated fair value at the date of donation. The cost of normal maintenance and repairs that does not add to the value of the asset or materially extend asset lives is not capitalized in the proprietary funds. Public domain (infrastructure) general fixed assets (i.e., roads, bridges, sidewalks, and other assets that are immovable and of value only to the County) are capitalized under GASB Statement No. 34. The County has not fully implemented the capitalization of the infrastructure assets in the governmental activities column in the government‐wide financial statements as required under GASB Statement No. 34 for the infrastructure acquired prior to October 1, 2003. The County is allowed a four‐year period in which to capitalize the infrastructure assets and can prospectively account for the infrastructure over the next four years. All newly acquired infrastructure with the implementation of GASB Statement No. 34 is reported in the year acquired.


35

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Capital Assets (continued) – Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of business‐type activities is reflected in the capitalized value of the assets constructed, net of interest earned on the invested proceeds over the same period. Property, plant, and equipment are depreciated in the governmental or business‐type activities columns in the government‐wide financial statements using the straight‐line method over the following estimated useful lives:

Assets Years

Buildings 40 Improvements other than buildings 10‐20 Equipment 5‐10

Deferred Revenues – Deferred revenues in the governmental funds represent amounts due, which are measurable, but not available. Compensated Absences – It is the County’s policy to permit employees to accumulate earned but unused vacation and sick pay benefits. GASB codification specifies that a liability should be accrued for leave benefits that meet the following conditions:

1. The employer’s obligation relative to employee rights to receive compensation for future absences is attributable to the employee services already rendered.

2. The obligation relates to rights that vest or accumulate.

3. Payment of the obligation is probable.

4. The amount can be reasonably estimated.


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NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Compensated Absences (continued) – The County records a liability for accrued sick and vacation time when incurred in the government‐wide, proprietary, and fiduciary fund financial statements. A liability for these amounts is reported in the governmental funds only if they have matured, for example, as a result of employee resignation and retirements. The County uses the vesting method to calculate the compensated absence liability. In the proprietary fund, compensated absences are expended when earned. The entire amount of compensated absences is reported as a liability. At September 30, 2008, total compensated absences payable by the County was $684,392. Of this amount, $654,883 arises from governmental activity operations and $29,509 is attributable to business activity operations. Long‐Term Obligations – In the government‐wide financial statements, and proprietary fund types in the fund financial statements, long‐term debt and other long‐term obligations are reported as liabilities in the applicable governmental activities, business‐type activities, or proprietary fund type of statement of net assets. Long‐term debt and other obligations financed by proprietary funds are reported as liabilities in the appropriate funds. Fund Equity – Reserves represent those portions of fund equity appropriable for expenditure or legally segregated for a specific future use. Net Assets – Net assets represent the difference between assets and liabilities. Net assets invested in capital assets, net of related debt, consist of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction, or improvement of those assets. Net assets invested in capital assets, net of related debt exclude unspent debt proceeds. Net assets are reported as restricted when there are limitations imposed on their use either through the enabling of legislation adopted by the County or through external restrictions imposed by creditors, grantors, or laws or regulations of other governments. Restricted resources are used first to fund appropriation.


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NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Interfund Transactions – During the normal course of operations, the County has transactions between funds. The most significant types are operating transfer, reimbursements, and residual equity transfers.

1. Operating transfers – Operating transfers are transfers of resources from one fund to another fund, where the resources will be expended.

2. Reimbursements – Reimbursement from one fund to another are expended in the reimbursing fund and reduce the revenues/expenditures of the fund being reimbursed.

3. Residual equity transfer – residual equity transfers are nonrecurring and nonroutine transfer of equity between funds, or the transfer of residual balances of discontinued funds or projects to the general fund, capital projects fund, or the debt service fund.

As a general rule the effect of the interfund activity has been eliminated from the government‐wide financial statements. New Reporting Standard – In June 1999, GASB issued Statement No. 34, Basic Financial Statements – and Management’s Discussion and Analysis – for State and Local Governments. This statement establishes new financial reporting requirements for state and local governments throughout the United States, which consists of a Management’s Discussion and Analysis as required supplementary information. The statement requires new information and a restructure of much of the information that governments have presented in the past. Comparability with reports issued in all prior years will be affected. In June 2001, GASB then issued Statement No. 37, Basic Financial Statements – and Management’s Discussion and Analysis – for State and Local Governments: Omnibus – an amendment of GASB Statements No. 21 and No. 34. These new accounting and reporting standards require that assets and liabilities be reported as current and noncurrent with the difference between the two as net assets. The new standards were implemented in fiscal year 2003. Use of Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.


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NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Summary of Significant Accounting Policies (continued): Total Columns on Statement of Fiduciary Net Assets – Total columns are captioned “memorandum only” to indicate that they are presented only to facilitate financial analysis. Data in these columns does not present financial position in conformity with GAAP. Such data is not comparable to a consolidation. Interfund eliminations have not been made in the aggregate of this data. NOTE 2 — RECONCILIATION OF GOVERNMENT‐WIDE AND FUND FINANCIAL STATEMENTS: Explanation of Certain Differences Between the Governmental Fund Balance Sheet and the Government‐wide Statement of Activities – The governmental funds balance sheet includes a reconciliation between fund balance – total governmental funds and net assets – governmental activities as reported in the government‐wide statement of net assets. One element of that reconciliation explains that “capital assets used in governmental activities are not financial resources and therefore not reported in the funds.” The details of this $183,500,266 difference are as follows: Gross capital assets $ 479,088,216 Accumulated depreciation (295,587,950) Net adjustment to increase total governmental funds to arrive at net assets governmental funds $ 183,500,266 Another element of that reconciliation explains that “other long‐term assets are not available to pay for current‐period expenditures and, therefore, are deferred in the funds.” The details of this $362,401 difference are as follows: Unavailable deferred revenue $ 362,401 Net adjustment to increase total governmental funds to arrive at net assets governmental funds $ 362,401


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NOTE 2 — RECONCILIATION OF GOVERNMENT‐WIDE AND FUND FINANCIAL STATEMENTS (continued): Another element of that reconciliation explains that “long‐term liabilities that are not due and payable in the current period are not reported in the funds.” The details of this ($4,245,138) difference are as follows: Accrued interest payable $ (28,672) Capital leases payable (3,723,492) Special assessment bonds payable (355,000) Compensated absences (137,974) Net adjustments to reduce – total governmental funds to arrive at net assets – governmental activities $ (4,245,138) Explanation of Certain Differences Between the Governmental Fund Statement of Revenues, Expenditures, and Changes in Fund Balances and the Government‐wide Statement of Activities – The governmental fund statement of revenues, expenditures, and changes in fund balances includes a reconciliation between net changes in fund balances – total governmental funds and changes in net assets of governmental activities as reported in the government‐wide statement of activities. One element of that reconciliation explains that “Governmental funds report capital outlay as expenditures. However, in the statement of activities the cost of these assets is capitalized and depreciated over the period of the asset’s useful life. When capital assets are disposed of, the difference between the original cost and the depreciation, and the proceeds is recorded as gain or (loss) on the sale.” The details of this $(20,954,118) difference are as follows: Capital outlay $ 3,247,171 Depreciation expense (24,201,289) Net adjustment to decrease the net changes in fund balance – total governmental funds to arrive at changes in net assets of governmental activities $ (20,954,118)


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NOTE 2 — RECONCILIATION OF GOVERNMENT‐WIDE AND FUND FINANCIAL STATEMENTS (continued): Another element of that reconciliation states that the issuance of the long‐term debt (e.g., bonds) provides current financial resources to governmental funds, while the repayment of principal of long‐term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net assets. The details of this $459,881 difference are as follows: Principal repayments: Capital lease $ 239,881 Special assessment debt 220,000 Net adjustment to increase net changes in fund balance – total governmental funds to arrive at changes in net assets of governmental activities $ 459,881 NOTE 3 — STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY: Budgetary Information All County department heads are required to submit their annual budget requests to the County Auditor. The County Auditor is the Budget Officer, and as such Budget Officer, it is his/her duty to compile and prepare a preliminary budget for consideration by the County Commissioners. The budget is prepared by fund, department, and object. On or before the first Monday in August, the County Budget Officer submits the proposed budget to the County Commissioners for review and approval. When the tentative budget has been approved, it must be published no later than the third week of August. On or before Tuesday following the first Monday of September each year, the Board of Commissioners shall meet and hold a public budget hearing at which time any taxpayer may appear and be heard upon any part or parts of said tentative budget. Such hearing may be continued from day to day until concluded, but not to exceed a total of five days. Upon the conclusion of such hearing, the County Commissioners shall fix and determine the amount of the appropriated budget for each department of the County, separately, which in no event shall be greater than the amount of the overall tentative budget and by resolution the County Commissioners shall adopt the appropriated budget as a part of the official minutes of the Board. During the fiscal year, only the Board of County Commissioners may amend the annual appropriated budget by resolution through the courts or by the budget hearing process. The appropriated budget can be increased by expending unanticipated revenues or utilization of reserves.


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NOTE 3 — STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (continued): The County is required by State law to adopt annual appropriated budgets for the general and special revenue funds. All appropriated budgets for governmental funds are adopted on a basis consistent with GAAP. Budgets for enterprise funds are adopted on a non‐GAAP basis. Budgeted amounts are as amended during the fiscal year ended September 30, 2008. All appropriations, other than appropriations for incomplete improvements in process of construction, lapse at the end of the fiscal year. Appropriation accounts may remain open until the first Monday in November for payment of claims incurred against such appropriations prior to the close of the fiscal year. After the first Monday in November, the appropriations become null and void and any lawful claims presented thereafter against any subsequent appropriation will be provided for in the ensuing budget. Deficit Fund Equity At September 30, 2007, the Ambulance District fund had a deficit fund balance of $386,710. The Ambulance District is recognized as a separate legal taxing district. The Board of County Commissioners approves the annual Ambulance District budget, and is responsible for levying the balance necessary to fund the approved budget under the Ambulance District levy. The budget levy for 2008 was $2,612,878 for fiscal year 2008 operations. Loans have been made from the Justice Fund to the Ambulance District to help fund start‐up operations and will be paid back over a 12 ‐year period. NOTE 4 — DEPOSITS AND INVESTMENTS: The elected State Treasurer, following Idaho Code, is authorized to sponsor an investment pool that the County voluntarily participates in. The Joint Powers Investment Pool was established as a cooperative endeavor to enable public entities of the State of Idaho to aggregate funds for investment. This pooling is intended to improve administrative efficiency and increase investment yield. The Local Government Investment Pool (Pool) is managed by the State of Idaho Treasurer’s office. The funds of the Pool are invested in certificates of deposit, repurchase agreements, and U.S. government securities. The certificates of deposit are federally insured. The U.S. government securities and the collateral for the repurchase agreements are held in trust by a safekeeping bank. The Pool is not registered with the Securities and Exchange Commission or any other regulatory body – oversight is with the State Treasurer, and Idaho Code defines allowable investments. An annual audit of Joint Powers Investment Pool is conducted by the State Legislative Auditor’s Office. The Legislative Auditor of the State of Idaho has full access to the records of the Pool.


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NOTE 4 — DEPOSITS AND INVESTMENTS (continued): Through a “Cash Management Sweep Account and Automatic Daily Repurchase Agreement” dated in September 1997 and June 2007 with Wells Fargo Bank and Panhandle State Bank, respectively, the County invests idle cash in uninsured repurchase agreements. The repurchase agreements are fully collateralized with an undivided, fractional interest in obligations of, or obligations that are fully guaranteed by the United States government, its agencies, or instrumentalities. Title to the securities are vested in the bank. The bank repurchases the undivided, fractional interest from the County on the next banking day. Credit Risk – The County’s investment policy requires individual investments to have a credit rating of A or better by Standard and Poor’s Corporation or an equivalent nationally recognized statistical rating organization. All investments meet this requirement. The Local State Government Investment Pool is not rated. Concentration of Credit Risk – The County’s investment policy currently does not limit the balance of investments with a single issuer, however, one issuer holds more than 40% of the County’s total portfolio at September 30, 2008. As of September 30, 2008, the following issuers hold more than 5% of the County’s total portfolio: Panhandle State Bank – 42%, Wells Fargo Bank – 32%, and US Bank – 24%. Custodial Credit Risk – Investments – This is the risk that, in the event of the failure of the counterparty, the County will not be able to recover the value of its investments or collateral securities that are in the possession of the outside party. All of the County’s investments are registered in the name of the County in accordance with policy. At September 30, 2008, the market value of the repurchase agreements through Panhandle State Bank was $6,205,007. The investments in repurchase agreements are uninsured and unregistered. The investments are fully collateralized with securities held by the safekeeping bank in the bank’s name with market values of $6,205,007. Custodial Credit Risk – Deposits – This is the risk that in the event of a bank failure, the County’s deposits may not be available. As of September 30, 2008, substantially all of the County’s bank balance of deposits was exposed to custodial credit risk. The County has $3,701,802 in certificates of deposit carried at cost. Five $100,000 certificates of deposit are at separate banks covered by Federal Deposit Insurance Corporation insurance. The County has invested in Money Market Security in the amount of $4,225,781 which is AAA rated and in the direct name of the County. The repurchase agreements are direct obligations of or guaranteed by the United States, its agencies, or instrumentalities. They have a current market value equal to or greater than the principal amount of the transaction. The County’s investment policy requires working with primary or regional dealers for the purchase of its authorized securities. Investments are made with banks designated by the State Treasurer as a state depository.


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NOTE 4 — DEPOSITS AND INVESTMENTS (continued): Interest Rate Risk – As a means of limiting its exposure to fair value losses arising from changes in interest rates, the Treasurer may invest funds of the County that are not identified as operating funds, in investments with maturities longer than 450 days, but not to exceed four years. The County’s investments are in compliance with this policy. The County assumes that its callable investments will not be called. Through its investment policy, the County manages its exposure to fair value losses arising from increasing interest rates by holding all investments to maturity. The following table presents the County’s exposure to credit risk in accordance with the Segmented Time Distribution method. Credit Under 30 31‐180 181‐365 1 to 4 Market Investment Type Rating Days Days Days Years Value Cost Panhandle State Bank Repurchase Agreement N/A $ 6,205,007 $ ‐ $ ‐ $ ‐ $ 6,205,007 $ 6,205,007 State of Idaho Local Government Investment Pool N/A 15,052,926 ‐ ‐ ‐ 15,052,926 15,052,926 Total investments $ 21,257,933 $ ‐ $ ‐ $ ‐ $21,257,933 $ 21,257,933 NOTE 5 — DUE FROM OTHER GOVERNMENTAL UNITS: Amounts due from other governmental units include balances due from the federal government, state of Idaho, and other local governments related to grant funded activities, including airport construction, weed control, and justice activities. The County believes all balances are collectible, and as a result has not established an allowance for uncollectible accounts.


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NOTE 6 — CAPITAL ASSETS: Capital asset activity for the year ended September 30, 2008, was as follows: Beginning Ending Balance Increases Decreases Balance Governmental Activities

Capital assets, being depreciated: Infrastructure $ 454,942,956 $ 449,779 $ (24,950) $ 455,367,785 Buildings 4,843,007 1,513,591 ‐ 6,356,598 Machinery and equipment 16,117,564 1,283,801 (37,532) 17,363,833 Less accumulated depreciation (271,386,661) (24,201,289) ‐ (295,587,950)

Governmental activities capital

assets, net $ 204,516,866 $ (20,954,118) $ (62,482) $ 183,500,266

Depreciation expense was charged to functions as follows: General governmental services $ 255,139 Highways and streets 23,446,367 Culture and recreation 22,996 Public safety 402,375 Health 74,412

Total governmental activities depreciation expense $ 24,201,289


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NOTE 6 — CAPITAL ASSETS (continued): Beginning Ending Balance Increases Decreases Balance Business‐type Activities Capital assets, not being depreciated: Land $ 177,590 $ ‐ $ ‐ $ 177,590 Total capital assets, not being depreciated 177,590 ‐ ‐ 177,590 Capital assets, being depreciated: Buildings 867,479 ‐ ‐ 867,479 Improvements other than buildings 809,430 ‐ ‐ 809,430 Machinery and equipment 1,216,669 122,263 ‐ 1,338,932 Total capital assets, being depreciated 2,893,578 122,263 ‐ 3,015,841 Less accumulated depreciation for: Buildings (251,165) (21,687) ‐ (272,852) Improvements other than buildings (220,864) (41,420) ‐ (262,284) Machinery and equipment (1,008,497) (64,213) ‐ (1,072,710) Total accumulated depreciation (1,480,526) (127,320) ‐ (1,607,846) Total capital assets, being depreciated, net 1,413,052 (5,057) ‐ 1,407,995 Business‐type activities capital assets, net $ 1,590,642 $ (5,057) $ ‐ $ 1,585,585 Depreciation expense was charged to functions as follows: Solid Waste $ 127,320


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NOTE 7 — LEASES: Operating Leases Public Defender – On September 10, 2002, the County entered into an agreement to lease a portion of a building for office space. Total payments made for the year ended September 30, 2008, were $18,700. The lease expired on September 1, 2008. Indigent and Charity – On December 16, 2003, the County entered into an agreement to lease a portion of a building for office space. Total payments made for the year ended September 30, 2008, were $10,500. As extended, the lease expires January 31, 2009. Public Works – On December 16, 2003, the County entered into an agreement to lease a portion of a building for office space. Total payments made for the year ended September 30, 2008, were $22,060. As extended, the lease expires January 31, 2009. Prosecutor’s Office – On June 21, 2007, the County entered into an agreement to lease a portion of a building for office space. Total payments made for the year ended September 30, 2008, were $24,000. The lease expired on February 28, 2008. Future minimum annual lease payments at September 30, 2008, are: Year Ending September 30, Amount 2009 $ 5,863 Capital Leases The County has entered into various leases to purchase equipment. These lease agreements qualify as capital leases for accounting purposes and are recorded in the capital assets of the County. The cost of the leased assets is $4,500,554. The leases are collateralized by the assets.


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NOTE 7 — LEASES (continued): Capital Leases (continued) Future minimum annual lease payments at September 30, 2008, are:

Years Ending Road and Federal September 30, Bridge Building Total

2009 $ 235,614 $ 158,061 $ 393,675 2010 789,557 158,061 947,618 2011 203,266 158,061 361,327 2012 40,052 158,061 198,113 2013‐2017 188,474 790,305 978,779 2018‐2022 ‐ 2,408,172 2,408,172 Total minimum lease payments 1,456,963 3,830,721 5,287,684

Less amount representing interest (151,119) (1,413,073) (1,564,192)

Capital lease obligations $ 1,305,844 $ 2,417,648 $ 3,723,492 NOTE 8 — LONG‐TERM DEBT: Changes in Long‐Term Liabilities Long‐term liability activity for the year ended September 30, 2008, was as follows: Balance, Balance, Due October 1, September 30, Within 2007 Additions Reductions 2008 One Year Governmental activities:

Compensated absences $ 694,398 $ ‐ $ (39,515) $ 654,883 $ 516,909 Leases payable 3,652,042 311,331 (239,881) 3,723,492 214,764 Special assessment bonds 575,000 ‐ (220,000) 355,000 220,000

Governmental activities long‐term liabilities $ 4,921,440 $ 311,331 $ (499,396) $ 4,733,375 $ 951,673


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NOTE 8 — LONG‐TERM DEBT (continued): Changes in Long‐Term Liabilities (continued) Balance, Balance, Due October 1, September 30, Within 2007 Additions Reductions 2008 One Year Business‐type activities:

Compensated absences $ 27,097 $ 2,412 $ ‐ $ 29,509 $ ‐ Business‐type activities long‐term liabilities $ 27,097 $ 2,412 $ ‐ $ 27,509 $ ‐

The annual debt service requirements to amortize the note payable to the bank for redemption of special assessment bonds as of September 30, 2008, are: Years Ending 93‐1 September 30, Principal Interest 2009 $ 220,000 $ 29,575 2010 135,000 15,275 $ 355,000 $ 44,850 The holders of any special assessment bonds have no claims against the County under Idaho Code.


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NOTE 9 — RESTRICTED NET ASSET ACCOUNTS: Resolutions of the County require certain reservations of the Solid Waste Fund’s net assets:

Restricted for debt retirement $ 664 Restricted for capital improvements 664,313

Total restricted net assets $ 664,977

The balances of the Solid Waste Fund’s restricted net asset accounts are as follows:

Debt retirement $ 664 Capital improvements 664,313

Total restricted net assets $ 664,977

NOTE 10 — FUND TRANSFERS: Individual fund transfers in and out balances at September 30, 2008, were: Transfers Transfers Out In General Governmental Services $ 270,970 $ ‐ Road and Bridge 12,500 ‐ Airport ‐ 1 Fair ‐ 3 District Court 49,437 ‐ Health District ‐ 5 911 250,000 ‐ Indigent and Charity 12,492 ‐ Junior College 499,998 ‐ Revaluation 254,978 ‐ Tort ‐ 19 Parks and Recreation 250 ‐


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NOTE 10 — FUND TRANSFERS (continued): Transfers Transfers Out In Weeds $ ‐ $ 56,753 Justice 354,295 ‐ Waterways ‐ 17,813 Judgements 258 ‐ Ambulance 70,000 ‐ Grants 5,276 ‐ Capital Projects ‐ 1,742,860 Solid Waste 37,000 ‐ $ 1,817,454 $1,817,454 NOTE 11 — CONTINGENT LIABILITIES AND COMMITMENTS: Grants Amounts received or receivable from granting agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures which may be disallowed by the grantor cannot be determined at this time although the County expects such amounts, if any, to be immaterial. Lawsuits Bonner County is a defendant in several lawsuits. Although the outcome of these lawsuits is not presently determinable, in the opinion of the County’s management and legal counsel, the resolution of these matters will not have a material adverse effect on the financial condition of the County. Local Improvement District On February 26, 1993, and later amended on June 29, 1994, the County created Local Improvement District No. 93‐1 (LID No. 93‐1). LID No. 93‐1 was used for the acquisition, construction, and installation of paved streets and all necessary appurtenances thereto.


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NOTE 11 — CONTINGENT LIABILITIES AND COMMITMENTS (continued): Local Improvement District (continued) On February 13, 1995, the Board of County Commissioners adopted by ordinance the assessment roll for LID No. 93‐1 in the amount of $2,636,103. LID No. 93‐1 assessments are due from property owners within the local improvement district and are receivable annually over 15 years. On March 20, 1995, the Board of County Commissioners adopted by ordinance approval for the issuance and sale of LID No. 93‐1 bonds in the aggregate principal amount of $2,420,654. Such bonds mature serially beginning April 30, 1996, and annually on each year thereafter until April 30, 2010. Receipt of annual assessment installments in February is used for paying annual maturity of said bonds. On September 13, 1996, the County created Local Improvement District No. 96‐1 (LID No. 96‐1). LID No. 96‐1 was used for the acquisition, construction, and installation of pavement improvements to Lower Pack River Road. On October 14, 1997, the Board of County Commissioners adopted by ordinance the assessment roll for LID No. 96‐1 in the amount of $136,626. LID No. 96‐1 assessments are due from property owners within the local improvement district and are receivable annually over ten years. On December 4, 1997, the Board of County Commissioners adopted by ordinance approval for the issuance and sale of LID No. 96‐1 bonds in the aggregate principal amount of $120,862. Such bonds mature serially beginning November 15, 1999, and annually each year thereafter until November 2007. Receipt of annual assessment installments in October is used for paying annual maturity of said bonds. NOTE 12 — DEFERRED COMPENSATION PLAN: The County offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all County employees at their option, permits participants to defer a portion of their salary until future years. The deferred compensation is not available to participants until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the participant or beneficiary) solely the property of the participant. Participants’ rights under the plan are equal to the fair market value of the deferred account for each participant.


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NOTE 12 — DEFERRED COMPENSATION PLAN (continued): Recent changes in the Internal Revenue Code provided that such funds administered by municipalities are not subject to claims by general creditors. In accordance with Government Accounting Standards such programs administered by independent outside trustees do not require inclusion in the financial statements. The assets and liabilities relating to this deferred compensation plan have been excluded in the County’s financial statements. NOTE 13 — DEFINED BENEFIT PENSION PLAN: On July 1, 2003, the County joined the Public Employee Retirement System of Idaho (System). The System administers the Public Employee Retirement Fund Base Plan (PERSI). PERSI is a cost sharing multiple‐employer public retirement system, and was created by the Idaho State Legislature. It is a defined benefit plan requiring that both the member and the employer contribute. The plan provides benefits based on members’ years of service, age, and compensation. In addition, benefits are provided for disability, death, and survivors of eligible members of beneficiaries. The authority to establish and amend benefit provisions is established in Idaho Code. Designed as a mandatory system for eligible state and school district employees, the legislation provided for other political subdivisions to participate by contractual agreement with PERSI. Financial reports for the plan are available from PERSI upon request. After five years of credited service, members become fully vested in retirement benefits earned to date. Members are eligible for retirement benefits upon attainment of the ages specified for their employment classification. For each month of credited service, the annual service retirement allowance is 2% (2.3% police) of the average monthly salary for the highest consecutive 42 months. The contribution requirements of the County and its employees are established and may be amended by the PERSI Board of Trustees. For the year ended June 30, 2008, the required contribution rate as a percentage of covered payroll for members was 6.23% for general members and 7.65% for police. The employer rate as a percentage of covered payroll was 10.39% for general members and 10.73% for police members. Bonner County contributions required and paid were $1,388,614 for the year ended September 30, 2008.


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NOTE 14 — RISK MANAGEMENT: The County is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; and natural disasters for which the County carries commercial insurance. The County accounts for the majority of transactions involving insurance claims, deductibles, and expenses in the tort fund, which is reported as part of the special revenue funds. This fund has the power to levy an annual property tax to provide funds to pay insurance premiums. The County employs a risk manager, whose duties include drafting and reviewing contracts, monitoring and defending claims, and evaluating the adequacy of insurance coverage. The risk manager informs and educates employees of responsibilities regarding prevention of loss exposure related to their duties. Insurance is maintained through the Idaho Counties Reciprocal Management Program (ICRMP). ICRMP is an insurance pool serving all public entities in Idaho through provision of property, general liability, auto liability, physical damage, and public officials’ insurance. The County pays an annual premium to ICRMP for insurance coverage. The ICRMP 2007‐2008 County insurance policy provides coverage up to a limit of $500,000 for any single claim (brought pursuant to Title 6, Chap. 9 Idaho Code). This is the statutory limit of the Idaho tort claims act. For any other type of liability claim, the policy limit is $2,000,000. The aggregate amount or total combined amount of all liability claims added up in a single policy year is $3,000,000. ICRMP provides property insurance coverage structured so that ICRMP retains the first $100,000 of damage to any County property. Alianz, an A++ reinsurer and one of the very largest reinsurers in the world, provides coverage for the remainder of the damage. The limits of the property coverage are tied to the County’s statement of values. If the buildings, vehicles, and other property are listed on the County’s statement of values, the County has coverage for the replacement cost of the damaged property. Excluded from the maximum total deductible per policy period are deductibles paid for flood and/or earthquake, and boiler and machinery losses. The deductibles for these occurrences are $2,500 per incident with no annual limit. At September 30, 2008, the County had a variety of outstanding claims. The County risk manager and legal staff maintain the position that the County bears little or no loss liability, based upon the strength of the claims and prior experience. All claims during the three years ended September 30, 2008, were below the limits of the insurance coverage.


54

NOTE 15 — CONDUIT DEBT OBLIGATIONS: During the fiscal year ended September 30, 2001, the County issued Industrial Revenue Bonds to provide financial assistance to a private sector entity for the acquisition and construction of an industrial development facility deemed to be in the public interest. The bonds are secured by the property financed and are payable solely from payments received from the underlying mortgage loans. Upon repayment of the bonds, ownership of the acquired facility transfers to the private sector entity served by the bond issuance. Neither the County, State, nor any political subdivision thereof is obligated in any manner for the repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements.

SUPPLEMENTAL INFORMATION


Sandpoint, Idaho

Combining Balance Sheet -

Nonmajor Governmental Funds September 30, 2008

Total

Nonmajor Nonmajor Nonmajor

Special Capital Debt

Revenue Projects Service

Funds Funds Funds Total

Assets

Cash and cash equivalents 6,412,106$ 1,275,572$ 126,861$ 7,814,539$

Restricted cash - - 183,381 183,381 Receivables, net of allowance for uncollectibles:

Taxes 228,475 685 - 229,160 Accounts 133,285 - - 133,285 Interest 150 - - 150

Due from other funds - - - - Due from other governments 54,201 - - 54,201 Prepaid assets 19,005 - - 19,005

Total assets 6,847,222$ 1,276,257$ 310,242$ 8,433,721$


LIABILITIES:

Warrants payable 732,150$ 400,729$ -$ 1,132,879$

Vouchers payable 151,861 3,510 - 155,371 Accrued payroll 89,126 - - 89,126 Accrued retirement payable - - - - Due to other funds 18,000 - - 18,000 Deferred revenue 230,200 673 - 230,873 Compensated absences payable 96,958 - - 96,958

Total liabilities 1,318,295 404,912 - 1,723,207

FUND BALANCES:

Unreserved 5,528,927 871,345 310,242 6,710,514

Total liabilities and fund balances 6,847,222$ 1,276,257$ 310,242$ 8,433,721$

See accompanying independent auditors’ report.

56


Sandpoint, Idaho

Combining Balance Sheet —

Nonmajor Special Revenue Funds September 30, 2008

Balance

Junior Historical District Carried

Airport Grants College Revaluation Society Court Forward

Assets

Cash and cash equivalents 313,523 $ 897,043 $ 324,848 $ 584,508 $ 4,769 $ 985,226 $ 3,109,917 $


for uncollectibles:

Taxes 4,461 - 122 70,468 1,355 49,606 126,012

Accounts 25,476 - - 68 - 35,031 60,575

Interest - 60 - - - - 60

Due from other governments - 53,990 - - - 211 54,201

Prepaid assets - - - - - - -

Total assets 343,460 $ 951,093 $ 324,970 $ 655,044 $ 6,124 $ 1,070,074 $ 3,350,765 $


LIABILITIES:

Warrants payable 3,627 $ 393,384 $ - $ 32,869 $ - $ 46,005 $ 475,885 $

Vouchers payable 10,093 683 120,873 - - - 131,649

Accrued liabilities - - - 29,605 - 31,119 60,724

Due to other funds - - - - - - -

Deferred revenue 34,896 - 107 61,456 1,198 43,052 140,709

Compensated absences payable - - - 28,593 - 33,809 62,402

Total liabilities 48,616 394,067 120,980 152,523 1,198 153,985 871,369

FUND BALANCES 294,844 557,026 203,990 502,521 4,926 916,089 2,479,396


fund balances 343,460 $ 951,093 $ 324,970 $ 655,044 $ 6,124 $ 1,070,074 $ 3,350,765 $


57


Sandpoint, Idaho


Nonmajor Special Revenue Funds (Continued) September 30, 2008

Balance Indigent Balance

Brought Special County and Carried

Forward Highway Fair 911 Charity Forward

Assets

Cash and cash equivalents 3,109,917 $ 505,398 $ 53,581 $ 650,825 $ 461,847 $ 4,781,568 $


for uncollectibles:

Taxes 126,012 - 9,791 - 20,448 156,251

Accounts 60,575 - - 49,017 14,523 124,115

Interest 60 - - 90 - 150

Due from other governments 54,201 - - - - 54,201

Prepaid assets - - - - - -

Total assets 3,350,765 $ 505,398 $ 63,372 $ 699,932 $ 496,818 $ 5,116,285 $


LIABILITIES:

Warrants payable 475,885 $ 699 $ 3,340 $ 77,453 $ 120,983 $ 678,360 $

Vouchers payable 131,649 - - - 20,212 151,861

Accrued liabilities 60,724 1,132 4,830 18,080 1,969 86,735

Due to other funds - - - 18,000 - 18,000

Deferred revenue 140,709 - 8,564 - 17,850 167,123

Compensated absences payable 62,402 - 10,532 20,097 766 93,797

Total liabilities 871,369 1,831 27,266 133,630 161,780 1,195,876

FUND BALANCES 2,479,396 503,567 36,106 566,302 335,038 3,920,409


fund balances 3,350,765 $ 505,398 $ 63,372 $ 699,932 $ 496,818 $ 5,116,285 $


58


Sandpoint, Idaho



Balance Balance

Brought Veterans Carried

Forward Weeds Memorial Judgements Tort Forward

Assets

Cash and cash equivalents 4,781,568 $ 169,763 $ - $ 10 $ 592,747 $ 5,544,088 $


for uncollectibles:

Taxes 156,251 8,850 - 75 43,529 208,705

Accounts 124,115 6,869 - - - 130,984

Interest 150 - - - - 150



Total assets 5,116,285 $ 185,482 $ - $ 85 $ 636,276 $ 5,938,128 $


LIABILITIES:

Warrants payable 678,360 $ 9,632 $ - $ - $ 1,640 $ 689,632 $

Vouchers payable 151,861 - - - - 151,861

Accrued liabilities 86,735 2,391 - - - 89,126

Due to other funds 18,000 - - - - 18,000

Deferred revenue 167,123 7,719 - 66 38,001 212,909

Compensated absences payable 93,797 3,161 - - - 96,958

Total liabilities 1,195,876 22,903 - 66 39,641 1,258,486

FUND BALANCES 3,920,409 162,579 - 19 596,635 4,679,642


fund balances 5,116,285 $ 185,482 $ - $ 85 $ 636,276 $ 5,938,128 $


59


Sandpoint, Idaho



Balance Balance

Brought Health Snowmobile- Snowmobile- Carried

Forward District Priest Lake Sandpoint Waterways Forward

Assets



for uncollectibles:

Taxes 208,705 13,778 - - - 222,483

Accounts 130,984 - - - - 130,984

Interest 150 - - - - 150



Total assets 5,938,128 $ 70,398 $ 80,219 $ 66,790 $ 157,190 $ 6,312,725 $


LIABILITIES:

Warrants payable 689,632 $ - $ 270 $ 12 $ 32,283 $ 722,197 $


Accrued liabilities 89,126 - - - - 89,126


Deferred revenue 212,909 12,048 - - - 224,957

Compensated absences payable 96,958 - - - - 96,958

Total liabilities 1,258,486 12,048 270 12 32,283 1,303,099

FUND BALANCES 4,679,642 58,350 79,949 66,778 124,907 5,009,626


fund balances 5,938,128 $ 70,398 $ 80,219 $ 66,790 $ 157,190 $ 6,312,725 $


60


Sandpoint, Idaho



Balance Parks

Brought and Court Court Drug

Forward Recreation Facilities Interlock Court Total

Assets



for uncollectibles:

Taxes 222,483 5,992 - - - 228,475

Accounts 130,984 - 1,740 561 - 133,285

Interest 150 - - - - 150


Prepaid assets - 19,005 - - - 19,005

Total assets 6,312,725 $ 170,820 $ 306,185 $ 23,260 $ 34,232 $ 6,847,222 $


LIABILITIES:

Warrants payable 722,197 $ 3,662 $ - $ 905 $ 5,386 $ 732,150 $


Accrued liabilities 89,126 - - - - 89,126


Deferred revenue 224,957 5,243 - - - 230,200

Compensated absences payable 96,958 - - - - 96,958

Total liabilities 1,303,099 8,905 - 905 5,386 1,318,295

FUND BALANCES 5,009,626 161,915 306,185 22,355 28,846 5,528,927


fund balances 6,312,725 $ 170,820 $ 306,185 $ 23,260 $ 34,232 $ 6,847,222 $


61


Sandpoint, Idaho

Combining Statement of Revenues,

Expenditures, and Changes in Fund Balances -

Nonmajor Governmental Funds Year Ended September 30, 2008

Total

Nonmajor Nonmajor Nonmajor

Special Capital Debt

Revenue Projects Service

Funds Funds Funds Total

REVENUES:

Taxes 4,426,330 $ - $ - $ 4,426,330 $

Licenses and permits 228,990 - - 228,990

Intergovernmental 3,225,729 - - 3,225,729

Charges for services 642,557 - - 642,557

Fines 266,602 - - 266,602

Special assessments - - 209,175 209,175

Interest income 1,679 - 1,605 3,284

Rental income - 139,013 - 139,013

Miscellaneous 281,438 - - 281,438

Total revenues 9,073,325 139,013 210,780 9,423,118

EXPENDITURES:

Current:

General government 3,591,699 - - 3,591,699

Public safety 1,597,320 - - 1,597,320

Highways and streets 484,298 - - 484,298

Sanitation 153,309 - - 153,309

Health 264,469 - - 264,469

Welfare 477,641 - - 477,641

Education 246,049 - - 246,049

Culture and recreation 1,277,366 - - 1,277,366

Capital outlay 174,233 1,087,780 - 1,262,013

Debt service:

Principal - - 220,000 220,000

Interest and fiscal charges - - 47,326 47,326

Total expenditures 8,266,384 1,087,780 267,326 9,621,490

EXCESS OF REVENUES OVER (UNDER) EXPENDITURES 806,941 (948,767) (56,546) (198,372)

OTHER FINANCING USES:

Operating transfers in (out) (998,095) 1,742,860 - 744,765

NET CHANGE IN FUND BALANCE (191,154) 794,093 (56,546) 546,393

FUND BALANCES, BEGINNING OF YEAR 5,720,081 77,252 366,788 6,164,121

FUND BALANCES, END OF YEAR 5,528,927 $ 871,345 $ 310,242 $ 6,710,514 $


62


Sandpoint, Idaho


Expenditures, and Changes in Fund Balances —

Nonmajor Special Revenue Funds Year Ended September 30, 2008

Balance

Junior Historical District CarriedAirport Grants College Revaluation Society Court Forward

REVENUES:

Taxes 83,920 $ - $ 332 $ 1,181,539 $ 23,154 $ 845,677 $ 2,134,622 $

Licenses and permits - - - 7,609 - - 7,609

Intergovernmental 6,093 2,157,527 314,041 80,815 5,852 162,240 2,726,568

Charges for services - - - - - - -

Fines - - - - - 252,886 252,886

Interest income - - - - - - -

Miscellaneous 71,473 - - - - 115,485 186,958

Total revenues 161,486 2,157,527 314,373 1,269,963 29,006 1,376,288 5,308,643

EXPENDITURES:

Current:

General government 97,947 258,320 - 1,220,952 - 1,294,432 2,871,651

Public safety - 548,600 - - - - 548,600

Highways and streets - - - - - - -

Sanitation - - - - - - -

Health - - - - 28,980 - 28,980

Welfare - - - - - - -

Education - - 246,049 - - - 246,049

Culture and recreation - 920,217 - - - - 920,217

Capital outlay 9,700 - - - - 9,926 19,626

Total expenditures 107,647 1,727,137 246,049 1,220,952 28,980 1,304,358 4,635,123


(UNDER) EXPENDITURES 53,839 430,390 68,324 49,011 26 71,930 673,520

OTHER FINANCING SOURCES (USES):

Operating transfers in (out) 1 (5,276) (499,998) (254,978) - (49,437) (809,688)

NET CHANGE IN FUND BALANCE 53,840 425,114 (431,674) (205,967) 26 22,493 (136,168)

FUND BALANCES, BEGINNING

OF YEAR 241,004 131,912 635,664 708,488 4,900 893,596 2,615,564

FUND BALANCES, END OF YEAR 294,844 $ 557,026 $ 203,990 $ 502,521 $ 4,926 $ 916,089 $ 2,479,396 $


63


Sandpoint, Idaho



Nonmajor Special Revenue Funds (Continued) Year Ended September 30, 2008

Balance Indigent Balance

Brought Special County and CarriedForward Highway Fair 911 Charity Forward

REVENUES:

Taxes 2,134,622 $ - $ 164,032 $ 593,632 $ 341,352 $ 3,233,638 $

Licenses and permits 7,609 - - - - 7,609

Intergovernmental 2,726,568 458,000 - - - 3,184,568

Charges for services - - - 624,497 - 624,497

Fines 252,886 - - - - 252,886

Interest income - - - 1,679 - 1,679

Miscellaneous 186,958 - - 60 60,924 247,942

Total revenues 5,308,643 458,000 164,032 1,219,868 402,276 7,552,819

EXPENDITURES:

Current:

General government 2,871,651 960 - - - 2,872,611

Public safety 548,600 - - 1,041,804 - 1,590,404

Highways and streets - 484,298 - - - 484,298

Sanitation - - - - - -

Health 28,980 - - - - 28,980

Welfare - - - - 477,641 477,641

Education 246,049 - - - - 246,049

Culture and recreation 920,217 - 166,709 - - 1,086,926

Capital outlay 19,626 - 22,000 78,095 - 119,721

Total expenditures 4,635,123 485,258 188,709 1,119,899 477,641 6,906,630


(UNDER) EXPENDITURES 673,520 (27,258) (24,677) 99,969 (75,365) 646,189


Operating transfers in (out) (809,688) - 3 (250,000) (12,492) (1,072,177)

NET CHANGE IN FUND BALANCE (136,168) (27,258) (24,674) (150,031) (87,857) (425,988)


OF YEAR 2,615,564 530,825 60,780 716,333 422,895 4,346,397

FUND BALANCES, END OF YEAR 2,479,396 $ 503,567 $ 36,106 $ 566,302 $ 335,038 $ 3,920,409 $


64


Sandpoint, Idaho




Balance Balance

Brought Veterans CarriedForward Weeds Memorial Judgements Tort Forward

REVENUES:

Taxes 3,233,638 $ 156,323 $ - $ 277 $ 706,013 $ 4,096,251 $


Intergovernmental 3,184,568 35,661 - - - 3,220,229

Charges for services 624,497 - - - - 624,497

Fines 252,886 - - - - 252,886

Interest income 1,679 - - - - 1,679

Miscellaneous 247,942 1,758 - - 293 249,993

Total revenues 7,552,819 193,742 - 277 706,306 8,453,144

EXPENDITURES:

Current:

General government 2,872,611 - - - 702,996 3,575,607

Public safety 1,590,404 - - - - 1,590,404

Highways and streets 484,298 - - - - 484,298

Sanitation - 153,309 - - - 153,309

Health 28,980 - - - - 28,980

Welfare 477,641 - - - - 477,641

Education 246,049 - - - - 246,049

Culture and recreation 1,086,926 - - - - 1,086,926

Capital outlay 119,721 - - - - 119,721

Total expenditures 6,906,630 153,309 - - 702,996 7,762,935


(UNDER) EXPENDITURES 646,189 40,433 - 277 3,310 690,209


Operating transfers in (out) (1,072,177) 56,753 - (258) 19 (1,015,663)

NET CHANGE IN FUND BALANCE (425,988) 97,186 - 19 3,329 (325,454)


OF YEAR 4,346,397 65,393 - - 593,306 5,005,096

FUND BALANCES, END OF YEAR 3,920,409 $ 162,579 $ - $ 19 $ 596,635 $ 4,679,642 $


65


Sandpoint, Idaho




Balance Balance

Brought Health Snowmobile- Snowmobile- CarriedForward District Priest Lake Sandpoint Waterways Forward

REVENUES:

Taxes 4,096,251 $ 226,645 $ - $ - $ - $ 4,322,896 $

Licenses and permits 7,609 - 56,919 26,672 137,790 228,990

Intergovernmental 3,220,229 - - 3,000 - 3,223,229

Charges for services 624,497 - - - - 624,497

Fines 252,886 - - - - 252,886


Miscellaneous 249,993 - 770 - - 250,763

Total revenues 8,453,144 226,645 57,689 29,672 137,790 8,904,940

EXPENDITURES:

Current:

General government 3,575,607 - - - - 3,575,607

Public safety 1,590,404 - - - - 1,590,404


Sanitation 153,309 - - - - 153,309

Health 28,980 235,489 - - - 264,469

Welfare 477,641 - - - - 477,641

Education 246,049 - - - - 246,049

Culture and recreation 1,086,926 - 31,702 23,120 62,893 1,204,641

Capital outlay 119,721 - - - 42,188 161,909

Total expenditures 7,762,935 235,489 31,702 23,120 105,081 8,158,327


(UNDER) EXPENDITURES 690,209 (8,844) 25,987 6,552 32,709 746,613


Operating transfers in (out) (1,015,663) 5 - - 17,813 (997,845)

NET CHANGE IN FUND BALANCE (325,454) (8,839) 25,987 6,552 50,522 (251,232)


OF YEAR 5,005,096 67,189 53,962 60,226 74,385 5,260,858



66


Sandpoint, Idaho




Balance Parks

Brought and Court Court DrugForward Recreation Facilities Interlock Court Total

REVENUES:

Taxes 4,322,896 $ 103,434 $ - $ - $ - $ 4,426,330 $


Intergovernmental 3,223,229 - - - 2,500 3,225,729

Charges for services 624,497 - 18,060 - - 642,557

Fines 252,886 - - 5,994 7,722 266,602


Miscellaneous 250,763 30,675 - - - 281,438

Total revenues 8,904,940 134,109 18,060 5,994 10,222 9,073,325

EXPENDITURES:

Current:

General government 3,575,607 - - - 16,092 3,591,699

Public safety 1,590,404 - - 6,916 - 1,597,320


Sanitation 153,309 - - - - 153,309

Health 264,469 - - - - 264,469

Welfare 477,641 - - - - 477,641

Education 246,049 - - - - 246,049

Culture and recreation 1,204,641 72,725 - - - 1,277,366

Capital outlay 161,909 12,324 - - - 174,233

Total expenditures 8,158,327 85,049 - 6,916 16,092 8,266,384


(UNDER) EXPENDITURES 746,613 49,060 18,060 (922) (5,870) 806,941


Operating transfers in (out) (997,845) (250) - - - (998,095)

NET CHANGE IN FUND BALANCE (251,232) 48,810 18,060 (922) (5,870) (191,154)


OF YEAR 5,260,858 113,105 288,125 23,277 34,716 5,720,081



67


Sandpoint, Idaho

Statement of Revenues - Budget and Actual -

General Fund Year Ended September 30, 2008

Variance

FavorableOriginal Final Actual (Unfavorable)

Taxes:

Current 2,367,135 $ 2,367,135 $ 1,957,209 $ (409,926)$

Penalties and interest - - 3,714 3,714

REA tax 14,880 14,880 16,889 2,009

Total taxes 2,382,015 2,382,015 1,977,812 (404,203)

Licenses and permits:

Motor vehicle licenses 302,150 302,150 301,268 (882)

Trailer house licenses 3,400 3,400 3,482 82

Recreation vehicle licenses 6,000 6,000 5,904 (96)

Boat licenses 8,500 8,500 9,626 1,126

Pawnbroker licenses - - 60 60

Conditional use permit 23,000 23,000 13,459 (9,541)

Building licenses and permits 420,795 420,795 261,835 (158,960)

Total licenses and permits 763,845 763,845 595,634 (168,211)

Intergovernmental:

Inventory phase-out 492,000 492,000 488,550 (3,450)

Category 58 replacement revenue 24,197 24,197 24,197 -

Liquor allocation 53,000 53,000 51,102 (1,898)

Revenue sharing 175,000 175,000 175,000 -

Extension office 4,500 4,500 4,125 (375)

Total intergovernmental 748,697 748,697 742,974 (5,723)

Charges for services:

Recorder’s fees 250,000 250,000 218,107 (31,893)

Planning fees 94,831 94,831 76,989 (17,842)

Treasurer fees 20,000 20,000 27,469 7,469

Assessor’s fees 26,300 26,300 21,493 (4,807)

Title company billings and access fees 36,925 36,925 83,111 46,186

Total charges for services 428,056 428,056 427,169 (887)

Interest income 1,163,500 1,163,500 1,010,123 (153,377)

Miscellaneous:

Sale of County property - - 500 500

Elections - - 120 120

Refunds and reimbursements - - 8,539 8,539

Miscellaneous 6,280 6,280 47,571 41,291

Total miscellaneous 6,280 6,280 56,730 50,450

Total general fund revenues 5,492,393$ 5,492,393$ 4,810,442$ (681,951)$


Budgeted Amounts

68


Sandpoint, Idaho

Statement of Expenditures - Budget and Actual -

General Fund Year Ended September 30, 2008

VarianceFavorable


Clerk – Auditor:General government:

Salaries 301,660 $ 301,660 $ 288,474 $ 13,186 $ Other services and charges 94,610 94,610 80,431 14,179

Capital outlay 5,000 5,000 1,181 3,819 Total clerk - auditor 401,270 401,270 370,086 31,184

Treasurer:General government:

Salaries 185,259 185,259 179,874 5,385 Other services and charges 63,290 63,290 36,818 26,472

Capital outlay - - 9,686 (9,686)Total treasurer 248,549 248,549 226,378 22,171

Emergency management:Public safety:

Salaries 73,857 73,857 63,071 10,786 Other services and charges 15,100 15,410 15,319 91

Total emergency management 88,957 89,267 78,390 10,877

Commissioners:General government:


Capital outlay 2,300 2,300 1,803 497 Total commissioners 246,964 246,964 239,939 7,025

Coroner:Public safety:

Salaries 44,661 44,661 43,696 965 Other services and charges 58,073 58,073 52,820 5,253

Total coroner 102,734 102,734 96,516 6,218

Buildings and grounds:General government:

Salaries 145,417 145,417 136,859 8,558 Other services and charges 39,756 41,256 40,996 260

Total buildings and grounds 185,173 186,673 177,855 8,818


Budgeted Amounts

69


Sandpoint, Idaho


General Fund (Continued) Year Ended September 30, 2008

VarianceFavorable


General:General government:

Benefits 864,352 $ 864,352 $ 738,787 $ 125,565 $ Other services and charges 1,333,753 1,333,753 782,011 551,742

Capital outlay 10,323 10,323 - 10,323 Total general 2,208,428 2,208,428 1,520,798 687,630

Extension office:General government:

Salaries 82,675 82,675 82,384 291 Other services and charges 31,695 31,695 31,692 3

Total extension office 114,370 114,370 114,076 294

Data processing:General government:


Capital outlay 8,000 8,000 6,004 1,996 Total data processing 141,490 141,490 113,759 27,731

Assessor – motor vehicles:General government:


Capital outlay 1,500 1,500 2,601 (1,101)Total assessor – motor vehicles 264,163 264,163 247,489 16,674

Planning:General government:


Capital outlay 4,800 4,800 20,071 (15,271)Total planning 593,485 593,485 524,071 69,414


Budgeted Amounts

70


Sandpoint, Idaho


General Fund (Continued) Year Ended September 30, 2008

VarianceFavorable


Information services:General government:

Other services and charges 174,900 $ 174,900 $ 175,197 $ (297)$ Capital outlay 1,500 1,500 1,181 319

Total information services 176,400 176,400 176,378 22

Personnel:General government:


Capital outlay 2,200 2,200 2,175 25 Total personnel 61,210 61,210 56,084 5,126

Geographic information systems:General government:

Salaries 80,607 80,607 79,753 854 Other services and charges 27,764 27,764 28,101 (337)

Capital outlay 3,200 3,200 2,551 649 Total geographic information systems 111,571 111,571 110,405 1,166

Debt service:Principal 106,513 106,513 49,808 56,705 Interest and fiscal charges 120,997 120,997 120,997 -

Total debt service 227,510 227,510 170,805 56,705

Total general fund expenditures 5,172,274 $ 5,174,084 $ 4,223,029 $ 951,055 $


EXPENDITURES 320,119 $ 318,309 $ 587,413 $ 269,104 $







71

Budgeted Amounts


Sandpoint, Idaho


Justice Fund Year Ended September 30, 2008

Variance

Favorable


Justice:

Taxes:

Current 8,843,135 $ 8,843,135 $ 8,442,881 $ (400,254)$

Penalties and interest 32,000 32,000 74,073 42,073

REA tax 72,650 72,650 72,441 (209)

Total taxes 8,947,785 8,947,785 8,589,395 (358,390)

Licenses and permits:

Drivers licenses 65,000 65,000 83,746 18,746

Boat licenses 135,000 135,000 137,790 2,790

Beer and liquor licenses 22,000 22,000 22,180 180

Other licenses and permits 4,000 4,000 4,998 998

Total licenses and permits 226,000 226,000 248,714 22,714

Intergovernmental:

State revenue sharing 1,180,000 1,180,000 1,097,151 (82,849)

Payment in lieu of taxes 122,690 122,690 158,897 36,207

Kootenai 1,200 1,200 1,200 -

Oldtown services 3,600 3,600 3,600 -

U.S. Forest Service 4,000 4,000 - (4,000)

Army Corps of Engineers 75,000 75,000 77,592 2,592

FILT-I F&G - - 5,510 5,510

Contributions and donations - - 820 820

Park Corp of Engineers 16,000 16,000 16,100 100

Ambulance District note repay 130,460 130,460 17,418 (113,042)

Total intergovernmental 1,532,950 1,532,950 1,378,288 (154,662)


Prisoner board, transport and other fees 352,100 352,100 451,257 99,157

Kitchen fund 500 500 427 (73)

Processing and servicing fees 50,000 50,000 74,755 24,755

Fingerprinting and bonding fees 14,000 14,000 13,063 (937)

Work release and inmate labor 59,000 59,000 59,057 57

Sheriff’s sale proceeds - - 721 721

Other 39,000 39,000 35,130 (3,870)

Total charges for services 514,600 514,600 634,410 119,810


Budgeted Amounts

72


Sandpoint, Idaho


Justice Fund (Continued) Year Ended September 30, 2008

Variance

Favorable


Justice (continued):

Miscellaneous:

Pay phone commissions 45,000 $ 45,000 $ 44,733 $ (267)$

ITD reinstatement 22,000 22,000 25,560 3,560

Prisoner reimbursements 25,760 25,760 35,341 9,581

Court surcharge 800 800 49,696 48,896

Public defender costs 20,000 20,000 27,573 7,573



Total justice fund revenues 11,334,895 $ 11,334,895 $ 11,033,842 $ (301,053)$


Budgeted Amounts

73


Sandpoint, Idaho


Justice Fund Year Ended September 30, 2008

Variance



Justice:

Public safety:

Clerk:

Salaries 643,853 $ 643,853 $ 619,309 $ 24,544 $

Sheriff:

Salaries 2,312,319 2,342,557 2,336,396 6,161

Other services and charges 345,883 462,126 471,470 (9,344)

Capital outlay 184,900 284,900 265,371 19,529

Total sheriff 2,843,102 3,089,583 3,073,237 16,346

Prosecuting attorney:

Salaries 738,025 732,025 701,824 30,201

Other services and charges 73,976 113,181 87,868 25,313

Capital outlay 6,030 12,030 17,439 (5,409)

Total prosecuting attorney 818,031 857,236 807,131 50,105

Public defender:

Salaries 308,621 308,621 308,231 390


Capital outlay 1,450 1,450 2,506 (1,056)

Total public defender 470,161 500,161 478,529 21,632

Juvenile detention:

Salaries 414,367 414,367 406,429 7,938


Capital outlay 2,340 2,340 1,589 751

Total juvenile detention 588,862 588,862 566,616 22,246

General:

Salaries 50,000 - - -

Benefits 2,367,421 2,367,421 2,074,665 292,756


Capital outlay - 150,000 - 150,000

Total general 3,129,743 3,229,743 2,790,546 439,197


74


Sandpoint, Idaho


Justice Fund (Continued) Year Ended September 30, 2008

Variance

Favorable


Justice (continued):

Public safety (continued):

Jail:

Salaries 1,589,995 $ 1,472,232 $ 1,456,010 $ 16,222 $


Capital outlay 45,850 45,850 39,789 6,061

Total jail 2,102,175 2,060,812 2,044,584 16,228

Marine patrol:

Salaries 115,490 115,490 107,186 8,304

Other services and charges 19,510 19,510 (3,714) 23,224

Capital outlay - - 18,410 (18,410)

Total marine patrol 135,000 135,000 121,882 13,118

Building and grounds:

Other services and charges 20,000 20,000 19,817 183

Total building and grounds 20,000 20,000 19,817 183

Five percent statutory reserve:

Other services and charges 200,000 50,000 - 50,000

Total justice fund expenditures 10,950,927 $ 11,175,250 $ 10,521,651 $ 653,599 $


EXPENDITURES 383,968 $ 159,645 $ 512,191 $ 352,546 $







Budgeted Amounts

75


Sandpoint, Idaho

Statement of Revenues and Expenditures -

Budget and Actual - Road and Bridge Fund Year Ended September 30, 2008

Variance

Budgeted Amounts FavorableOriginal Final Actual (Unfavorable)

Revenues

Taxes:

Current 4,044,971 $ 4,044,971 $ 3,826,838 $ (218,133)$


REA tax 39,675 39,675 42,308 2,633

Total taxes 4,103,546 4,103,546 3,903,497 (200,049)

Intergovernmental:

Highway user revenue 1,345,000 1,345,000 1,556,309 211,309

Sales tax base and excess 140,000 140,000 168,018 28,018

Category 58 replacement revenue 8,270 8,270 11,026 2,756

State cost sharing - - 33,867 33,867

Forest apportionment 786,485 786,485 784,898 (1,587)

Total intergovernmental 2,279,755 2,279,755 2,554,118 274,363

Miscellaneous:

Miscellaneous 59,910 59,910 49,962 (9,948)

Refunds and reimbursements 15,000 15,000 99,603 84,603


Total revenues 6,458,211 6,458,211 6,607,180 148,969

Expenditures

Highways and streets:

Salaries 1,778,883 1,778,883 1,581,701 197,182

Benefits 740,369 740,369 657,141 83,228

Other services and charges 3,002,343 3,002,343 1,908,358 1,093,985

Total current 5,521,595 5,521,595 4,147,200 1,374,395

Capital outlay 516,244 818,058 1,331,132 (513,074)

Debt service:

Principal 235,762 235,762 169,206 66,556

Interest and fiscal charges 52,564 52,564 52,564 - Total debt service 288,326 288,326 221,770 66,556


EXCESS OF REVENUES OVER (UNDER) EXPENDITURES 132,046 (169,768) 907,078 1,076,846



NET CHANGE IN FUND BALANCE 132,046 (169,768) 894,578 1,064,346


FUND BALANCES, END OF YEAR 2,835,335 $ 2,533,521 $ 3,597,867 $ 1,064,346 $


76


Sandpoint, Idaho


Budget and Actual - Ambulance District Year Ended September 30, 2008

Variance

Favorable


Revenues

Taxes:

Current 2,612,878 $ 2,612,878 $ 2,299,127 $ (313,751)$


Total revenues 2,612,878 2,612,878 2,299,377 (313,501)

Expenditures

Current:

Salaries 1,044,089 1,044,089 928,306 115,783

Benefits 424,444 424,444 339,413 85,031


Total current 2,390,544 2,416,544 2,015,587 400,957

Capital outlay 136,334 136,334 261,669 (125,335)

Debt service:

Principal 56,814 56,814 20,867 35,947

Interest 3,186 3,186 3,186 -

Total debt service 60,000 60,000 24,053 35,947


EXCESS OF REVENUES OVER (UNDER)

EXPENDITURES 26,000 - (1,932) (1,932)



NET CHANGE IN FUND BALANCE 26,000 - (71,932) (71,932)

FUND BALANCES, BEGINNING OF YEAR (314,778) (314,778) (314,778) -

FUND BALANCES, END OF YEAR (288,778)$ (314,778)$ (386,710)$ (71,932)$


Budgeted Amounts

77


Sandpoint, Idaho


(Non-GAAP Budgetary Basis) - Budget

and Actual - Solid Waste Enterprise Fund Year Ended September 30, 2008

Variance



REVENUES:


Fees 2,473,765 $ 2,473,765 $ 2,589,259 $ 115,494 $

Commercial disposal 1,875,000 1,875,000 2,212,746 337,746

Gate 176,850 176,850 217,643 40,793

Total charges for services 4,525,615 4,525,615 5,019,648 494,033


Miscellaneous - - - -

Total revenues 4,535,615 4,535,615 5,042,434 506,819

EXPENDITURES:

Salaries 650,193 650,193 601,098 49,095

Benefits 351,069 351,069 300,107 50,962

Other services and charges 3,157,927 3,257,927 3,037,402 220,525

Depreciation - - 127,320 (127,320)

Total expenses 4,159,189 4,259,189 4,065,927 193,262

376,426 276,426 976,507 700,081

TRANSFERS:

Transfers in (out) - - (37,000) 37,000


EXPENDITURES 376,426 $ 276,426 $ 939,507 $ 663,081 $


78

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